Why is Bitcoin dropping today? Four clear drivers of the $115k tumble

After weeks of climbing, Bitcoin is pulling back. The crypto giant has dropped a few points on the day, dragging the crypto market down with it. 

Bitcoin (BTC) is currently trading around $115,630, down roughly 2.6% today. This is one of the biggest 24‑hour drops since hitting its all‑time high of about $123,100 earlier this month. The price slide brings its losses over the past seven days to approximately 3.9%, extending the downward slide that commenced earlier in the week. 

The dip has painted the broader market red, with several altcoins and memecoins seeing even heavier losses. So, what’s behind the OG crypto’s drop?

Post-rally exhaustion and profit-taking 

Bitcoin ran hot for weeks, notching fresh all-time highs almost daily just over a week ago. But that momentum has cooled. Investors are locking in gains, whales are rotating funds, and large holders are rebalancing their positions, all contributing to the ongoing drop in price.

This shift opened the floodgates for liquidations. In the last 24 hours alone, nearly $586 million in long positions were wiped out across the board, according to CoinGlass. Bitcoin led the flush with around $150 million as it dropped toward $115K.

When leverage unwinds like this, losses compound fast. Forced selling often drags prices lower, rattles confidence, and turns a normal pullback into something sharper.

Outflows from Bitcoin ETFs

Despite closing their latest session in the green, Bitcoin ETFs have had a rough week overall. Over just three days, outflows hit $285 million across multiple issuers, snapping the 12-day inflow streak that had fueled momentum earlier this month. 

Institutional investors also appear to be cashing out after BTC’s recent highs, and the lack of new inflows is hurting short-term price momentum.

Ethereum is stealing the spotlight 

After surging over 50% this month, Ethereum (ETH) has taken over market attention. With record inflows in ETFs tracking the assets and renewed interest across institutional investors, Bitcoin’s dominance is slipping. 

Capital rotation is now driving toward ETH and a handful of alts, adding weight to Bitcoin’s decline. The shift isn’t just in flows, and is showing up in sentiment too. Discussions on X, Telegram, and Reddit are increasingly focused on alts, even after Bitcoin’s climb to $123,000, suggesting fading retail interest.

Macro jitters 

Uncertainty around U.S. trade policy is also weighing on Bitcoin. With a key tariff deadline looming on August 1 and talks with major partners like the EU, Brazil, and Canada still unresolved, investors are getting defensive.

Stocks are showing signs of caution, and that mood is bleeding into crypto. With the Fed meeting just days away, traders are trimming risk, and Bitcoin is feeling the pressure.

Is momentum gone for good?

Not necessarily. Analysts believe BTC is still in a strong position despite the drop today, and the current price action looks like a necessary breather before it resumes its uptrend. According to Rekt Capital, the market leader is still early in its current price discovery uptrend, suggesting there may be more upside before any major correction kicks in.

So far, BTC has successfully retested key support levels on both the daily and weekly charts, including the lower high it recently broke past. As long as it holds above the $119K level on the weekly close, Rekt says a breakout from the current bull flag remains in play.