IOTA Drops 53.36% in 24 Hours Amid Network Upgrades and Regulatory Scrutiny

On SEP 2 2025, IOTA dropped by 53.36% within 24 hours to reach $0.1883, IOTA dropped by 296.72% within 7 days, dropped by 147.99% within 1 month, and dropped by 3364.19% within 1 year.

A series of developments related to the IOTA network have raised concerns among investors and analysts, contributing to the sharp decline in the token’s value. The project recently announced the final phase of its network upgrade, IOTA 2.0, which is designed to enhance scalability and improve consensus mechanisms. While these updates are intended to strengthen the platform’s infrastructure, uncertainty around implementation timelines and potential disruptions has led to market instability. Developers have emphasized that the upgrade remains on schedule, but the market appears to be reacting to mixed signals.

The regulatory environment has also played a role in the recent volatility. IOTA recently faced scrutiny in several jurisdictions regarding the compliance status of its token model. The project has been actively engaging with regulatory bodies to clarify its structure, which involves reclassifying IOTA from a utility token to a digital asset with specific governance functions. Despite these efforts, the ambiguity surrounding the reclassification has dampened investor sentiment. No formal legal rulings have been issued, but the ongoing discussions have created a cautious atmosphere among market participants.

Analysts project that the token will remain under pressure in the short term if the regulatory clarity does not materialize soon. The IOTA Foundation has not provided a timeline for final compliance adjustments, adding to the uncertainty. Additionally, the absence of major institutional partnerships or enterprise adoption milestones has limited the upside potential for the token, with many observers waiting for clear signs of network utilization or real-world deployments.