By Rae Wee and Brigid Riley
SINGAPORE (Reuters) – Bitcoin hit its lowest since November and was set for its biggest weekly fall in over two years, swept up in a sell-off in tech stocks at a time when a $1.5 billion hack and doubts about U.S. crypto policy has left industry sentiment fragile.
The world’s largest cryptocurrency by market value dropped as much as 7% on Friday to $78,273, its lowest since November 10 and on track for a fifth straight day of declines.
It has fallen 16% in the past week, its biggest weekly drop since the collapse of the FTX crypto exchange in November 2022. The broader crypto market has lost nearly half a trillion dollars in the past week alone, according to Coingecko.
“Inflationary pressures, growth prospects are crumbling and Trump’s tariffs are not going away. And with Trump’s attention (on) anything except deregulating crypto, bitcoin traders are not happy,” said Matt Simpson, senior market analyst at City Index.
Bitcoin typically trades loosely in line with assets like tech stocks that rise when investors are optimistic about economic growth. The tech heavy Nasdaq is at its lowest since November. [.N]
Investors fear the so-called exceptionalism of the U.S. economy might be fading and are nervous about U.S. President Donald Trump’s moves to impose tariffs which have stoked fears of higher global inflation and slower growth. [MKTS/GLOB]
Investors judged AI darling Nvidia’s results harshly as well.
NEW ENVIRONMENT
For the world’s largest cryptocurrency, the environment is very different from mid-January, when it approached $110,000 on optimism that the Trump administration would champion a strategic bitcoin fund and loosen regulation.
But beyond a flurry of appointments of crypto-friendly officials when Trump took office, there has been little concrete news around that policy for investors.
The bitcoin price decline “shows that positive sentiments from a crypto-friendly administration and high-profile endorsements have run their course,” said Joshua Chu, Co-Chair of the Hong Kong Web3 Association.
“It’s clear bitcoin is a risk asset, not the inflation hedge or digital gold it’s often touted to be.”
Ether, the second-largest cryptocurrency by market value, was down 6% at $2,149.38, around its lowest since January 2024.
Trump’s own “TRUMP” memecoin that he launched upon his inauguration has lost 50% in value since then, while his wife’s “MELANIA” token has lost 90%.
Investors have also been pulling money out of bitcoin exchange-traded funds.
