Why the is Crashing : $120 Billion Wipeout and Bitcoin’s Big Drop

The crypto world is in red today. The total market cap has lost over $120 billion in just 24 hours. It now sits near $2.98 trillion, down from the key $3 trillion level. Bitcoin leads the fall, dropping below $90,000. Monero sees the worst hit, falling 21% under $500. What’s behind this sudden crash? Let’s break it down step by step.

The Shocking Numbers: How Bad Is the Crypto Market Dip?

The total crypto market cap, often called TOTAL, crashed hard. It lost $120 billion fast. This pushed it below the important $3 trillion mark. Now, it’s hovering around $2.98 trillion.

Bitcoin (BTC): Down 3.6%, trading at about $89,225.
Monero (XMR): Worst performer, down 21% to $491.
Overall Market: Broad selling shows investors are scared.

This kind of drop happens when fear takes over. Traders sell off to cut losses amid bad news.

Key Trigger: Trump’s Tariff Threats and Gold’s Rise

The main spark for comes from outside crypto. President Trump renewed threats of tariffs on Europe. This adds to global trade worries. At the same time, gold prices are climbing. Gold is a safe asset, pulling money away from risky ones like crypto.

Crypto is seen as a “risk-on” investment. When uncertainty grows, people flee to gold or cash. This shift drained capital from Bitcoin and altcoins. If tariffs become real, pressure could build more. The next support for total market cap is $2.92 trillion.

MicroStrategy’s Big Bitcoin Buy – But Shares Still Fall

Even big players are buying the dip. MicroStrategy made its largest Bitcoin purchase since November 2024. They bought 22,305 BTC for $2.13 billion right before the drop below $90,000. Now, their holdings top 709,715 BTC. This shows long-term faith in Bitcoin.

But the market didn’t care. MicroStrategy’s shares dropped over 7%. It proves short-term fear beats long-term plans right now.

Trump Media’s Token Airdrop: A Glimmer of Hope?

Not all news is bad. Trump Media & Technology Group announced a digital token distribution. The record date is February 2, 2026. Shareholders with at least one DJT stock share qualify. It’s through a partnership with Crypto.com. This could boost interest in crypto later, but it won’t fix today’s crash.

Bitcoin’s Technical Breakdown: Where Next?

Bitcoin price fell 3.6% in 24 hours to $89,225. Losing $90,000 hurt sentiment. Now, BTC tests $89,241 support.

If support holds:

Buyers may step in.
Price could rebound to $90,000, then $91,298 resistance.

If it breaks:

Sell-off deepens to $87,210.
Bearish control strengthens.

Watch volume. High selling volume means more pain ahead.

Monero’s Brutal 21% Plunge: Privacy Coins Under Fire

Monero (XMR) had the biggest loss. Down 21% to $491, below $500. Privacy coins like XMR suffer in weak markets. Investors dump them first.

On-chain data shows outflows. Holders are skeptical. If this goes on, $450 support is next.

Path to recovery:

Reclaim $500 as support.
Push to $560 resistance.

XMR needs buyers to fight back soon.

Macro Factors Fueling the Crypto Market Crash

Beyond tariffs and gold, other forces play a role:

Macro Uncertainty: Higher interest rates and slow growth hurt risk assets.
Investor Risk Aversion: Everyone pulls back at once.
Liquidity Crunch: Less money flowing into crypto exchanges.

The market cap needs global calm to recover. Better economic data could bring back risk appetite.

Can the Market Bounce Back Soon?

Recovery starts with holding key levels. For total cap:

Reclaim $3 trillion: Bullish sign.
Push to $3.05 trillion: Eases fear.

Bitcoin above $90k would help too. Watch for:

Fed rate cut hints.
Positive crypto news like ETF inflows.
Lower volatility.

Short-term, expect more ups and downs. Long-term bulls bet on Bitcoin’s strength.

What Should Traders Do Now?

In a , stay calm:

Dip Buyers: Wait for support holds.
HODLers: MicroStrategy shows conviction pays.
Short-Term Traders: Use tight stops.

Diversify. Don’t go all-in on one coin. Track on-chain metrics and news.

Final Thoughts on Today’s Crypto Downturn

The $120 billion wipeout stings, but crypto has seen worse. Tariff fears and gold flows sparked it. Bitcoin and Monero lead losses, but supports could spark rebounds. Stay informed on macro shifts. The path back to $3 trillion is there if fear fades.

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The post Why the Crypto Market is Crashing Today: $120 Billion Wipeout and Bitcoin’s Big Drop appeared first on Blockmanity.

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Filed under: Altcoins - @ January 22, 2026 1:32 am