- Bitcoin leads crypto decline as U.S.-China trade tensions spark global risk aversion
- Altcoin losses deepen amid leverage unwinds and Bitcoin-dominant market sentiment
- Despite price drop, market sentiment holds in “Greed” zone with strong trading volume
The cryptocurrency market experienced a notable dip on May 29, driven by a mix of geopolitical tension, technical weaknesses, and investor anxiety. The downturn began during late U.S. trading hours, following remarks by U.S. Treasury Secretary Scott Bessent , which confirmed a stall in trade discussions with China.
This development triggered a risk-off sentiment across global financial markets, spilling over into digital assets. As a result, major cryptocurrencies recorded significant price declines, with Bitcoin leading the sell-off.
Bitcoin Slides as Trade Talks Stall
Bitcoin, the market’s flagship cryptocurrency, fell by 2.78%, settling around $105,575.53. The decline came shortly after renewed concerns about the U.S.-China trade relationship.
Bessent’s comments highlighted the need for direct talks between leaders, which signaled that a resolution was not imminent. Consequently, investors reacted by pulling out of risk assets, including cryptocurrencies.
Related: U.S. Court vs. Trump Tariffs: Bitcoin and Altcoins Take a Hit
Ethereum also saw a sharp drop, falling 4.36% to $2,612.80. Other top coins like Solana and XRP were hit even harder. Solana lost 5.73%, while XRP dropped 4.66%. BNB also declined, trading at $669.22, a 2.45% fall.
Source: CoinMarketCap
These movements reflect a broader pullback in the digital asset sector, partly caused by long position liquidations. High leverage positions were unwound as prices dropped, exacerbating the selling pressure.
Market Metrics Paint a Mixed Picture
Despite the short-term correction, overall investor sentiment remains cautiously optimistic. The Fear and Greed Index stands at 61, placing market sentiment in the “Greed” zone. This suggests that investors expect recovery, although the current momentum favors caution.
Moreover, Bitcoin continues to outperform many altcoins, as reflected in the Altcoin Season Index, which is at a low 20 out of 100. This indicates the market is currently in a “Bitcoin Season” phase, where capital rotation favors Bitcoin over smaller-cap tokens.
Related: BTC, SOL, BNB, and ADA Funding Rate Flips Negative—Is the Crypto Market Bracing for a Drop?
The total market capitalization has dropped to $3.32 trillion, showing a decline from mid-May peaks. Trading volume remains strong at $146.05 billion over the last 24 hours, signaling continued investor engagement despite falling prices.
Outlook Remains Volatile
The CoinMarketCap 100 Index, which tracks the top 100 cryptocurrencies, dropped 3.53% to $204.05. This decline highlights the broad-based nature of the sell-off.
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