Why have cryptocurrencies lost value since January? An analysis of common pressure factors on BTC, ETH, BNB, and SOL

Cryptocurrency markets are experiencing periodic declines, but when all leading assets - Bitcoin, Ethereum, BNB, and Solana - move in the same direction, it usually signals more than one reason. In recent months, we have observed exactly this scenario. The sale of cryptocurrencies rarely results from a single factor. Instead, we are dealing with the convergence of many forces acting simultaneously - changes in geopolitical sentiment, macroeconomic pressure, significant outflows from ETF funds, changes in leveraged positions, and escalating liquidity issues.

Geopolitics and Uncertainty: The First Wave of Risk Reduction

When geopolitical tensions rise globally, institutional investors typically flee from high-risk assets first. Cryptocurrencies, due to their volatility, often find themselves at the forefront of this movement. CoinDesk reported Bitcoin dropping below $80,000 in the context of rising international tensions and political uncertainty. The Wall Street Journal described the mood as decidedly defensive, with market participants shifting to a “survival” strategy.

When the “off-risk” phase begins, funds do not reduce exposure selectively. They reduce it across their crypto allocation - this is why BTC, ETH, SOL, and other instruments fall simultaneously. This is not a choice of specific losers but a general flight from an entire category.

Macroeconomic Pressure: The Impact of Interest Rates and Dollar Strength

Regardless of news regarding specific projects, prices can come under pressure if the market expects higher interest rates and a strong dollar to persist. In such a scenario, high-volatility assets automatically lose their appeal. MarketWatch linked Bitcoin’s movements to broader macroeconomic uncertainty and changes in expectations regarding Federal Reserve policy. The Wall Street Journal noted a shift in investor focus from cryptocurrencies to more defensive assets.

The mechanism is simple:

• Higher interest rates make cash and treasury bonds more profitable
• Risk budgets in portfolios shrink
• Cryptocurrencies and lesser-known altcoins are usually sold off first

ETF Flows: From Support to Pressure

Since the legalization of spot ETFs for Bitcoin, capital flows in these funds have directly impacted market demand dynamics. Decrypt noted a significant outflow of $817 million from Bitcoin ETFs as the price fell to levels unseen in weeks. Bloomberg reported over $700 million withdrawn from Bitcoin ETFs in a single trading day. Yahoo Finance highlighted a series of outflows totaling $1.62 billion over several sessions.

These outflows, while not always signaling panic, generate persistent selling pressure. When ETFs must sell assets to fund shareholder payouts, their actions can provide a backdrop for broad downward price movements.

Position Liquidation: How Small Moves Become Cascades

Cryptocurrency derivative markets remain highly leveraged. When Bitcoin breaks key support levels, long positions are automatically closed, forcing participants to sell in the open market. Each new wave of selling drives the price down further, triggering additional liquidations - creating a domino effect.

CoinGlass, frequently cited during sell-offs, documents these liquidation chains across various exchanges. A typical sequence looks as follows:

• Bitcoin drops and breaks an important support level
• Leveraged long positions are forced to close
• The strength of this selling pressure accelerates movements in derivative markets
• Altcoins, with lower liquidity, experience even more dramatic moves

This explains why seemingly minor declines can quickly transform into severe drops.

Market Liquidity: When Capacity Decreases

Liquidity conditions matter just as much as major news. CoinDesk pointed out that thin liquidity, especially on weekends, amplifies downward movements. Fewer buyers on the order book means that any significant sell order moves the price faster and more aggressively.

When liquidity decreases:

• Market sellers struggle to find enough buyers
• The size of the price movement increases disproportionately to the size of transactions
• Volatility accelerates, triggering additional liquidations

Altcoins Under More Pressure than Bitcoin

Even when Bitcoin leads the downward movement, altcoins typically lose value faster. The reasons are structural:

• They are more beta than Bitcoin and react more aggressively to changing sentiment
• They have thinner liquidity, which amplifies their movements
• Bitcoin and Ethereum are often used as collateral for altcoin positions, so when leading instruments drop, traders reduce exposure everywhere
• In periods of stress, Bitcoin acts like a market index, while ETH, BNB, and SOL trade more like high-growth assets - more volatile and susceptible to sell-offs

Ecosystem-Specific Stress in Cryptocurrency

In addition to macroeconomic factors, issues specifically related to cryptocurrencies can also amplify pressure. CryptoQuant noted that Bitcoin mining profitability has reached its lowest levels in months, adding another element of stress to the network. The Bank for International Settlements (BIS) pointed out the structural vulnerabilities of cryptocurrency markets, particularly regarding volatility and liquidity risk concentration.

What Signals Could Indicate Stabilization?

Markets do not rebound immediately, but selling pressure typically weakens when specific positive signals emerge:

• Outflows from ETFs slow down or reverse into inflows
• Liquidations calm down as forced sellers exit the market
• Bitcoin maintains key support levels over multiple trading sessions
• Volatility decreases and liquidity returns to normal levels
• Macroeconomic headlines shift toward less stressful narratives

Summary: Convergence of Pressure in Cryptocurrency Markets

Current prices (as of March 2026) show that the market remains under pressure: Bitcoin trading around $66.74K (up 1.04% in the last day), Ethereum around $2.01K (up 1.25%), BNB around $615.60 (up 0.78%), and Solana around $82.75. Despite recent signs of recovery, the dynamics indicate that many pressure factors from the January period still affect the market.

Cryptocurrencies are not falling because someone told them to. They are falling because geopolitics raises concerns, macro remains tight, ETF flows are reversing, leveraged positions are being forcibly closed, and liquidity is vanishing precisely when it is most needed. All these factors together act like a system - when one part begins, the others follow. That’s why we see movement across the cryptocurrency market, where BTC, ETH, BNB, and SOL are falling together.

In such conditions, the market does not choose winners - it broadly reduces exposure. As an investor, observe these mechanisms, manage risk carefully, and remember the significance of macroeconomic signals for the dynamics of high-risk markets.