Top Reasons Crypto Market Is Dropping Today

The crypto market is dropping today with market cap paring earlier gains and sliding to $2.82 trillion, down nearly 90 billion over 24 hours. The Fear & Greed Index has slipped to Neutral (50) from Greed (68), indicating a sudden decline in sentiment.

Bitcoin price also extended its 48-hour fall to more than 4%, trading near $81,700 on Friday. Moreover, Ethereum and XRP continues to remain under pressure amid risk-off sentiment and macro jitters. Let’s look at the reasons behind the latest selloff in crypto market.

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Crypto Market Drops amid Macro Jitters as Inflation in Japan Reaches 9-Month High

Japan’s annual inflation rate accelerated to 2.1% in September 2026 from 1.9% in the previous two months, marking the highest level since December 2025. Moreover, core inflation climbed to 2.1% from 1.7% in August, exceeding the Bank of Japan’s 2% target for the first time in nine months.

Bitcoin price and the crypto market dropped as rising inflation supports the Bank of Japan’s (BOJ) monetary tightening. The BOJ is widely anticipated to leave rates unchanged in October, but another rate hike in December has high odds. BOJ raised interest rates from 1% to 1.25% recently.

The Japanese yen strengthened toward 156 against the US dollar on Friday, reaching its highest level in five weeks. US dollar index (DXY) has increased to 101.83 today as yen strengthened and Brent crude oil prices surpassed 113 on Friday amid Middle East tensions.

Meanwhile, the US and Israel are reportedly preparing plans for renewed strikes after next month’s midterm elections. Experts claim Iran’s energy infrastructure would likely be a key target. However, both the US and Iran are open to easing tensions and seek ways to resolve transport in the Strait of Hormuz.

Gold prices briefly dropped below $4,000 on Friday, the lowest levels in nearly three months. Veteran trader Peter Brand suggests weekly charts indicate a rise in the gold/silver ratio to 121.7.

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Tech Stocks Selloff and AI Spending Concerns

Meanwhile, the US 10-year Treasury yield (US10Y) climbs around 4.98% on Friday after falling by more than 10 basis points in a previous session. Deeper selloffs in tech and artificial intelligence stocks are prompting investors to seek safer assets, including government bonds.

Meta, Nvidia, AMD, SpaceX and others fell on renewed doubts about the returns and pace of AI capital expenditures. Crypto market is reacting to weakness in tech stocks and leading to selloffs in Bitcoin price and other crypto assets.

As a result, institutional and retail investors are selling spot Bitcoin ETFs and crypto ETFs. Notably, spot Bitcoin ETFs saw solid inflows earlier this week. However, the trend faded amid a recent tech rout, with $635.6 million in net outflows on Thursday.

BlackRock’s IBIT saw $254.1 million selloff and Fidelity’s FBTC recorded $217.5 million in redemptions. Institutional demand has not fully offset the macro pressure in the short term.

Moreover, spot Ethereum ETFs recorded total net outflows of $111 million and spot Solana ETFs saw $2.65 million in outflows. On the other hand, XRP ETFs continue to record inflows, with $3.55 million on Thursday.

Crypto Market Volatility amid Bitcoin and Ethereum Options Expiry

Around $1.31 billion in Bitcoin options and $250 million in Ethereum options expire today on leading crypto derivatives exchange Deribit. The put/call ratio stands at 1.03 for Bitcoin, with a max pain price of $82,000. For Ethereum, the ratio is 1.22, with max pain at $2,450.

The significant amount of options expiring today is adding volatility in the crypto market. However, the monthly crypto market expiry next week is a key event to watch for traders, with max pain at $78,000.

Bitcoin price currently trading around $81,700, below the 50-day moving average at $81,835. The price needs to rebound above $89,500 for a major rally.

Analyst CredibleCrypto expected a significant upside move in Bitcoin price. He predicted clearing the swing high at $90,500 in the coming days.