After reaching an all-time high more than a month ago, Bitcoin fell 1.59% on Sunday at 4:21 pm ET. This drop wiped out the more than 30% increase it had gained earlier this year. According to a Bloomberg report, the excitement around the Trump’s support for crypto has faded, and the recent slowdown in big tech stocks has made investors less willing to take risks.
How much did Bitcoin slip and why?
Bitcoin slipped below $93,714 on Sunday, which is lower than its closing price at the end of last year, when markets were rising after Trump’s election win. The currency had hit a record high of $126,251 on October 6, but it started falling just four days later after Trump made unexpected remarks about tariffs, shaking markets around the world.
Matthew Hougan, the San Francisco-based chief investment officer for Bitwise Asset Management told Bloomberg that the “general market is risk-off”. He said that crypto was the “canary in the coal mine for that, it was the first to flinch.”
Big Bitcoin buyers pull back leaving market on edge
Over the last month, many of the biggest buyers, including ETF managers and large companies, have quietly slowed their purchases. This has taken away the steady support that helped push Bitcoin to record highs earlier this year, the report said.
ETFs alone brought in more than $25 billion, taking total assets to around $169 billion. Their steady buying helped present Bitcoin as a tool to balance portfolios and protect against rising prices, weaker currencies, and political uncertainty. But that story was always fragile, and now it is fading again.
Jake Kennis, senior research analyst at Nansen, told Bloomberg that the selloff is driven by long-term holders booking profits, big investors pulling money out and global economic worries. He added that the market has “temporarily chosen a downward direction after a long period of consolidation/ranging.”
Bitcoin’s sharp swings leave smaller tokens struggling
Bitcoin has taken investors on a rough ride this year. It fell to about $74,400 in April after Trump announced new tariffs, then climbed back to record levels before sliding again. The world’s first major cryptocurrency still makes up nearly 60% of the total crypto market, which is valued at around $3.2 trillion.
The latest slump has hit smaller and less liquid tokens even harder. MarketVector index that tracks the lower half of the top 100 digital assets has dropped by nearly 60% this year, showing how fragile the wider market has become, the Bloomberg report said.
