Altcoins are feeling the heat this Tuesday as a wave of economic uncertainties sends shockwaves through the cryptocurrency market. Key players like XRP, Solana (SOL), and Cardano (ADA) have taken a hit, each tumbling more than 3% within the past 24 hours. Meanwhile, Dogecoin (DOGE), Avalanche (AVAX), and Sui (SUI) have suffered even steeper declines, plunging over 5%. This downturn has left XRP and SOL nursing losses of about 13% over the past week, with DOGE dropping by a staggering 18%. As explored in our recent coverage of Dogecoin leading losses amid profit-taking, the trend highlights the volatile nature of the crypto market.
Ripple Effects of Economic Jitters
The ongoing sell-off appears to be exacerbated by a cocktail of economic events looming on the horizon. The Federal Reserve’s two-day meeting, which began Tuesday, has traders on edge. Although Fed Chair Jerome Powell’s team is anticipated to keep interest rates steady on Wednesday, the market remains jittery due to President Donald Trump’s calls for rate cuts. As if that weren’t enough, the crypto world is also bracing for Friday’s nonfarm payrolls report, which could further unsettle already anxious investors.
Bitcoin, the heavyweight of the crypto scene, has managed to stay relatively stable, trading flat at $117,312. But the same can’t be said for altcoins, which have been under pressure since early last week. The influx of leveraged bets has only added fuel to the fire, making the current climate even more precarious.
Market Turmoil and Leverage Unwinding
“Traders are clearly skittish,” remarks Julian Thomas, an analyst at Crypto Insights. “The convergence of economic data releases and political pressures is creating an atmosphere ripe for volatility.” Thomas notes that the unwinding of leverage—where traders close out positions to mitigate risk—has significantly contributed to the altcoin downturn. “Leverage can magnify both gains and losses, and right now, we’re seeing the downside of that equation,” he adds. This follows a pattern of profit-taking, as detailed in our analysis of Dogecoin’s recent market performance.
Adding to the market’s woes are several Trump tariff deadlines hitting this week, further complicating the landscape for both crypto and traditional equities. U.S. stocks, which initially showed promise, have since wiped out earlier gains, with the Nasdaq and S&P 500 both slipping into negative territory. The interconnectedness of global markets means that such shifts reverberate widely, impacting asset classes beyond equities.
Historical Context and Forward Outlook
Historically, periods of economic uncertainty have often led traders to reassess their portfolios, seeking safer havens or liquidating riskier assets. The current scenario is no exception. “We’re in a moment where traditional market events are having outsized impacts on crypto,” explains Anna Martinez, a financial strategist at Blockchain Solutions. “It’s a reminder that while crypto can often seem insulated, it’s still subject to the broader economic tides.”
Looking ahead, the key question is whether this trend will persist. “The market’s next moves are contingent on a few pivotal factors,” Martinez continues, pointing to the Fed’s rate decision and the upcoming payroll data as potential catalysts for further market shifts. “Investors should keep a close eye on these developments,” she advises, “as they could set the tone for crypto’s trajectory in the coming months.”
Ultimately, the current turbulence raises questions about the resilience of altcoins in the face of macroeconomic pressures. As traders navigate these choppy waters, the interplay between leverage, economic data, and geopolitical factors will be crucial in determining the market’s next chapter. Whether altcoins can weather this storm remains to be seen—but one thing is certain: the road ahead is anything but predictable.
Source
This article is based on: DOGE, SOL and XRP Lead Altcoin Losses as Rate Jitters and Leverage Unwind Hit Crypto
Further Reading
Deepen your understanding with these related articles:
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- Ether, Dogecoin Lead Modest Market Gains, Bitcoin Holds $118K as CPI Print Fuels Rate Cut Bets
Steve Gregory is a lawyer in the United States who specializes in licensing for cryptocurrency companies and products. Steve began his career as an attorney in 2015 but made the switch to working in cryptocurrency full time shortly after joining the original team at Gemini Trust Company, an early cryptocurrency exchange based in New York City. Steve then joined CEX.io and was able to launch their regulated US-based cryptocurrency. Steve then went on to become the CEO at currency.com when he ran for four years and was able to lead currency.com to being fully acquired in 2025.
