The cryptocurrency market experienced a broad downturn on October 28, 2025, with tokens in the Layer 2 sector leading the losses after a recent period of strong gains. The overall sector registered a 4.46% drop over the past 24 hours, pulling back from previous highs.

Layer 2s Feel the Brunt of the Correction

Several prominent Layer 2 projects saw steep declines. The downturn was led by Merlin Chain, which fell by 16.8%. Other notable assets feeling the pressure included Zora, with a 7.58% loss, and Mantle, which decreased by 5.43%.

Major Assets Stumble

The negative sentiment also affected the market’s largest assets. Bitcoin slipped by 1%, bringing its price down to $113,800. Ethereum saw a more significant drop of 2.5%, falling below the key psychological level of $4,000.

Market Outliers and Analyst Outlook

Despite the widespread declines, a few assets bucked the trend. Hedera posted a 6.05% gain, reportedly driven by anticipation for its expected Exchange-Traded Fund (ETF) listing on Nasdaq. In the more speculative corner of the market, Trump-themed meme coins collectively rose by nearly 10%.

While the short-term picture appears bearish, some analysts remain optimistic about the market’s future. Markus Levin, co-founder of XYO, suggested that underlying conditions are favorable for digital assets. “The combination of easier monetary policy and a calmer global backdrop creates a powerful setup for Bitcoin and other cryptocurrencies, which thrive in periods when liquidity is abundant and sentiment is improving,” he stated.