Bitcoin price drops to pre-2024 election levels
June 5, 2026
The recent dip in bitcoin price below $60,000 last Friday was a significant event, marking the price levels not seen since October 2024 before Donald Trump’s U.S. Presidential election win. Trump’s administration implemented various policies that were viewed favorably by the bitcoin and broader crypto industry. Actions like the removal of Gary Gensler as the SEC head, establishment of a strategic bitcoin reserve, and the pardoning of Silk Road operator Ross Ulbricht were highlights of his tenure and attracted positive attention. The market responded positively to these developments initially. However, the recent trajectory of the crypto market has been quite different following the all-time high bitcoin price of around $125,000 reached last October. The market saw a downturn, with leading altcoin Zcash also experiencing a 60% plunge in value in the wake of the disclosure of a significant bug.
Following Trump’s election win in 2024, the bitcoin price surged from approximately $66,000 to nearly $110,000 over the ensuing weeks, representing substantial gains for investors. Unfortunately, these gains have been entirely erased as bitcoin’s price witnessed a significant drop. Some experts attribute this recent weakness in the bitcoin market to Strategy, a bitcoin treasury company, selling a small percentage of their bitcoin holdings. However, contrary views suggest that the downward pressure is a result of existing bitcoin holders seeking more significant exposure to the AI industry. This interest in AI investments could be linked to the impending initial public offerings of companies like OpenAI and Anthropic or Google parent company Alphabet’s planned $80 billion capital raise for strengthening the infrastructure related to Gemini. Notably, billionaire investor Mark Cuban decided to offload his bitcoin holdings following what he perceived as the digital asset’s failure to serve as a safe-haven asset during recent geopolitical upheavals.
The dominance of the AI industry in the current investment landscape was emphasized by Forest For The Trees CEO Luke Gromen, who remarked, “AI is sucking all of the oxygen out of the room, all of the liquidity out of the room.” This trend seems to have impacted bitcoin as well, diverting investor attention and funds towards the AI sector.
Despite some positive strides for the crypto industry, such as the passing of the GENIUS Act and the pardoning of Ross Ulbricht by the Trump administration, regulatory clarity remains a significant concern. The Clarity Act, aimed at providing regulatory certainty for the crypto industry, is still under discussion in the Senate. Moreover, debates surrounding the legality of offering rewards like interest to stablecoin holders have triggered conflicts between the banking and crypto sectors. The vocal disagreement between JPMorgan Chase CEO Jamie Dimon and Coinbase CEO Brian Armstrong on this issue is evidence of the friction prevailing within these industries. With allegations of ethical violations and potential conflicts of interest, there is growing scrutiny around the Trump family’s alleged involvement in the crypto sector, potentially impacting regulatory decisions in the future.
While the challenges in the bitcoin market have been noteworthy, Zcash has faced more significant hurdles lately. A bug in the Zcash network that could allow malicious actors to create artificial Zcash currency resulted in a substantial drop of over 60% in Zcash’s value. The bug, discovered by a researcher utilizing Anthropic’s Claude Opus 4.8 model, had remained undetected for about four years. Concerns have been raised regarding the security of DeFi due to advancements in AI models, with experts cautioning against its usage at present. Efforts are underway to audit the Zcash supply more rigorously to address issues related to the creation of false currency. Despite the recent setback, Zcash remains one of the top-performing assets, recording over a 500% increase in value over the past year. After a swift decline to approximately $250, the price has shown signs of recovery, hovering around $325 as of Friday morning.