Bitcoin has dropped to its lowest level since Donald Trump was elected in November 2024, erasing the gains registered by the digital asset since the crypto-friendly US president won his return to the White House.
The largest cryptocurrency extended its almost four-month slide, falling below $74,424.95, the lowest price of 2025. That level was seen on April 7 after Mr Trump’s initial tariff plan upended financial markets worldwide.
“A lot of the traders were trying to buy the dip, betting on a rebound above $80,000,” said Bohan Jiang, senior derivatives trader at FalconX. “As Bitcon drifts lower, a lot of those positions have been liquidated, putting pressure on prices.”
Bitcoin fell as much as 7 per cent to $72,877 on Tuesday in New York, its lowest since November 6, 2024, before regaining some ground to trade at $76,200 in Asia early on Wednesday. It is down 13 per cent this year and 39 per cent from its October 6 peak above $126,000.
The rout follows a crippling bout of liquidations on October 10 – started by additional comments by Mr Trump on tariffs – that wiped out $19 billion in token bets that the broader crypto market has yet to recover from.
Almost half a trillion dollars has been wiped off cryptocurrencies in less than a week as the sell-off led by Bitcoin accelerated.
Total crypto market value has slumped by $467.6 billion since January 29, according to CoinGecko data.
“Asia morning sentiment is cautious and defensive. The mood is still risk‑off, but the pace of forced selling has slowed compared with the US close,” said Rachael Lucas, an analyst at BTC Markets.
Still, “Bitcoin printing sub‑$73,000 has pushed sentiment into extreme fear”, she said.
Market turbulence
Bitcoin’s latest slide comes amid broader market turbulence, including a historic slump in precious metals at the end of last week after their spectacular rally. The S&P 500 on Tuesday retreated from near records on a tech sell-off, while gold and silver rebounded and oil surged on renewed geopolitical risk.
For Bitcoin, the crypto derivatives market is pointing to further weakness with no significant positive catalysts in sight.
The open interest, the number of outstanding contracts, for crypto futures contracts collapsed at the weekend, according to data from CME and Coinglass. The funding rate for perpetual futures, which makes up most of the trading volume in digital assets, has turned negative, meaning there is more demand for bearish bets.
Put options – contracts that protect against downside risk – have eased, but strike-price concentrations show the market has not shaken off its jitters.
“Crypto sentiment is hitting rock bottom,” said Augustine Fan, partner at Hong Kong-based crypto options platform SignalPlus. “Volatility has finally moved up after a year-long move lower as traders scrambled for protection, with markets trading in bear-market mode.”
Pro-crypto President
Outside the price tumult caused by tariffs in April last year, Bitcoin had largely stayed above the $75,000 level it reached after the re-election of Mr Trump, who promised policies more favourable to the crypto industry.
But the market has faced persistent downwards pressure since the October sell-off. Despite a brief reprieve in late November, with Bitcoin bouncing back nearly 7 per cent, the mood turned sour again in December.
Investor concerns have remained elevated amid economic headwinds and persistent AI bubble fears.
While some institutional holders have held firm, retail participation has faded as major long-term Bitcoin holders have dumped billions worth of the asset.
The MarketVector Digital Assets 100 Small-Cap Index, which tracks the 50 smallest digital assets in a basket of 100, also plummeted almost 70 per cent over the past year. So-called alt-coins have largely underperformed Bitcoin and Ether since the two largest cryptocurrencies by market value received US approval for exchange-traded products, attracting institutional money. Yet spot ETFs for those assets – with a significant portion held by retail investors – have seen billions in outflows in November.
“Bitcoin still trades like a high-beta risk asset, not digital gold,” said Morten Christensen, a trader who runs AirdropAlert.com. “That doesn’t mean the thesis is dead – it means it’s not there yet.”
Bitcoin’s plunge is raising doubts that it functions as a kind of “digital gold”, as it has not acted as a safe haven during a period of heightened geopolitical uncertainty. Investor Michael Burry this week warned that Bitcoin has been exposed as a purely speculative asset, failing to establish itself as a hedge similar to precious metals.
Historically, there has been a “tremendous amount” of near-religious belief in holding on to Bitcoin no matter what, Michael Novogratz, chief executive of Galaxy Digital, said on an earnings call. “And somehow that virus or that fever broke, and you started seeing some selling.”
