Crypto markets are down again today, with total capitalization falling back to $2.8 trillion, which is exactly where it was in March 2024, long before the most pro-crypto administration in history was in the White House.

On March 13, Chainlink community liaison Zach Rynes described it as the “most bizarre clown market” he’s ever seen in crypto.

“We’ve just seen the most bullish catalysts in the history of crypto in a single month, but the spooky macro conditions are suppressing positive market reactions,” he added.

He observed that the US government has shifted from being “adamantly hostile against crypto” to being “not just neutral but “openly pro-crypto.”

Yet still, markets have tanked by 26%, or a trillion dollars, since their peak two months ago.

Bear Market Fears Return

Rynes listed some of the bullish fundamentals that have occurred recently, including the US establishing a strategic Bitcoin reserve, which eliminates the possibility of a crypto ban. It also incentivizes nations around the world to begin stockpiling in an “arms race of economic dominance.”

There are also clear rules and regulations coming for stablecoins, market structure, and DeFi, “enabling institutions to finally start engaging in the industry in a meaningful way while strengthening the dollar’s position,” he added.

Most bizarre clown market I’ve ever seen in crypto

We’ve just seen the most bullish catalysts in the history of crypto in a single month’s time but the spooky macro conditions are suppressing positive market reactions

The U.S. government has shifted from being adamantly… pic.twitter.com/EI3BtWJJDx

Finally, new spot crypto ETF filings are appearing by the day, “opening up market access to entirely new cohorts of market investors who previously couldn’t engage.”

However, macro influences such as Trump’s trade wars and increased odds of a US recession have kept the asset class suppressed in the short term.

“Trade wars and tariffs are tangential to crypto policy, that’s the short medium term macro shitshow that’s creating broader market volatility.”

On March 13, blockchain analytics firm Santiment observed that trade volumes have been dwindling recently, and this signals diminished trader enthusiasm and an “early warning sign of weakening market momentum.”

“After further market cap declines these past two weeks, trader behavior indicates a mix of exhaustion, hopelessness, and capitulation.”

Crypto Market Outlook

The crypto market downtrend that began in late January has continued with further losses this week.

Bitcoin has actually gained marginally over the past 12 hours to tap $84,000 during early trading in Asia on Thursday. However, the asset remains down more than 8% over the past week.

Ethereum has been annihilated, sinking to bear market lows and failing to reclaim the psychological $2,000 level over the past few days. The altcoins are also in pain, with many falling back to yearly lows this week.