The crypto market is in turmoil, as Bitcoin (BTC) and most altcoins are plunging in value. BTC has fallen below $26,000, while some altcoins have lost more than 10% of their value.

The main reason behind this crash is the regulatory pressure from the U.S. authorities. The SEC has labeled many altcoins as securities, forcing some exchanges to delist them. Robinhood is one of them. SEC is also suing Binance US and Coinbase.

The CFTC is also cracking down on the crypto industry. It has fined a decentralized autonomous organization (DAO) for violating the law. This could set a precedent for other DAOs and their tokens, especially those based on Ethereum (ETH).

All these factors have reduced the liquidity and confidence in the crypto market. Some market makers, such as Jump Trading and Jane Street, have scaled back their activities in the U.S. due to regulatory uncertainty.

Institutional investors are also withdrawing from the crypto sector, according to CoinShares. They may be waiting for the FED interest rate decision, which will be announced on Wednesday.

Another possible explanation is the seasonal effect of “sell in May, go away”. This is a common strategy among investors who sell their stocks in May and return in November to avoid volatility.

Disclaimer: The information provided is not trading advice. We strongly recommend independent research and/or consultation with a qualified professional before making any investment decision.