Bitcoin drops below $80,000, undoing most gains from Trump era: What is causing the crypto market decline?
Bitcoin’s value has plummeted below $80,000 for the first time since November, wiping out most of the gains that were achieved during Donald Trump’s presidency. This significant drop has sent shockwaves through the cryptocurrency market, leaving investors uncertain about the future.
The downward trend in Bitcoin’s price can be attributed to several factors, including Trump’s tariff policies, regulatory concerns, and a recent $1.5 billion hack of the Bybit platform. Avinash Shekhar, the co-founder and CEO of Pi42, highlighted the impact of these events on market sentiment, noting that they have eroded investor confidence and contributed to the decline in Bitcoin’s value. Ethereum has also been affected, hitting a yearlong low.
As Bitcoin briefly dipped to $81,000, a massive $106 million liquidation occurred, causing further market volatility. Investors are now grappling with the question of whether Bitcoin has reached a near-term floor or if further declines are on the horizon. Despite the challenges facing major assets, there is optimism that Dogecoin may demonstrate resilience and gain value in the midst of the struggle. Traders are closely monitoring key technical levels and economic indicators to anticipate Bitcoin’s next move.
The sell-off in the crypto market has intensified as Bitcoin drops below $80,000, marking a significant shift from the bullish breakout witnessed in November 2024. Other popular altcoins are also experiencing declines but have managed to hold above crucial support levels. Institutions like Blackrock have been selling large amounts of BTC and ETH, further contributing to the ongoing market turmoil.
President Trump’s announcement of an additional 10% tariff on China has exacerbated tensions in the market, impacting the crypto industry. Regulatory developments, such as the SEC’s investigation into Consensys and lawsuit against Coinbase, suggest that clearer regulations may be on the horizon. Moreover, the SEC’s stance on meme coins, which are not considered securities under the Howey Test due to their speculative nature, has implications for market dynamics.
Despite the challenges facing the cryptocurrency market, there is hope for a rebound, with Litecoin showing strength and potential for a quick recovery. As traders navigate the turbulent market conditions, it is crucial for investors to exercise caution and remain vigilant about the uncertainties that lie ahead. The crypto market’s future trajectory will be shaped by evolving regulatory frameworks, economic factors, and technical indicators.
