Why is Crypto Market Down Today? Bitcoin, Ethereum, XRP News, Litecoin Price and More

The sentiment index in the Bitcoin futures market has cooled to 36%, well below the neutral 50% mark. This comes after a brief spike to 70% between August 11–14, when Bitcoin surged to $123K. Currently trading near $115K, market momentum shows sellers dominating in the short term, with neutral open interest suggesting a shift from euphoria to range trading. Analysts warn that as long as sentiment stays under 45–50%, rallies may face selling pressure, raising the risk of testing $112K. All eyes are now on Fed Chair Jerome Powell’s speech for the next market trigger.

South Korea’s Financial Services Commission (FSC) has issued a directive requiring local crypto exchanges to suspend all lending services with immediate effect. The regulator said these offerings fall into a legal gray area and pose significant risks, noting that 13% of borrowers have already faced liquidation. Under the order, existing lending contracts can either be extended or repaid, but no new loans are allowed. The FSC also warned that exchanges failing to comply will face on-site inspections and potential penalties. Formal guidelines for crypto lending are expected to be introduced in the coming months.

Hyperliquid founder Jeff dismissed speculation that the project relies on special arrangements with market makers. Speaking on a podcast, he explained that, unlike many decentralized exchanges that raised funds by securing market-maker investments, Hyperliquid has never adopted that model. Jeff argued such practices create only a “short-term illusion” of liquidity rather than sustainable value. He clarified that the only exception is the HLP liquidity pool, a transparent system open to all users who can deposit directly through the protocol, far removed from traditional market-making agreements.

Bitcoin spot ETFs continue to dominate institutional portfolios, holding a massive $165.57 billion in assets under management (AUM). BlackRock’s IBIT leads with $85.25B, followed by Fidelity’s FBTC at $36.84B and Grayscale’s GBTC at $21.44B. In comparison, Ethereum spot ETFs collectively hold $25.56 billion, highlighting a stark contrast in allocation. Institutions remain heavily skewed toward Bitcoin, maintaining a 6:1 ratio of BTC to ETH exposure. This trend hints at Bitcoin’s position as the preferred institutional asset, while Ethereum continues to play catch-up despite its growing ETF presence.