Bitcoin tumbled sharply Thursday as a souring risk environment rippled through global markets, with volatility in precious metals and a broad selloff in technology stocks accelerating losses across the cryptocurrency sector.
The world’s largest cryptocurrency slid as low as $66,675.12, its weakest level since October 2024, just a month before President Donald Trump won the presidential election after signaling support for digital assets on the campaign trail. Bitcoin was last trading down about 6.5 percent at $67,817, capping a brutal stretch for crypto investors.
The downturn has erased staggering amounts of value. According to CoinGecko, the global cryptocurrency market has lost roughly $2 trillion since peaking at $4.379 trillion in early October. About $800 billion of that has vanished in just the past month, underscoring how quickly sentiment has turned.
Bitcoin is now down 11 percent for the week and off roughly 23 percent so far this year. Ether, the second-largest cryptocurrency by market capitalization, fell more than 7 percent Thursday to around $1,973. Ether has dropped nearly 14 percent this week alone and is down about 34 percent for the year, highlighting the depth of the selloff.
Broader market stress is adding fuel to the fire. Precious metals such as gold and silver have grown increasingly volatile as leveraged trades and speculative flows unwind. Silver plunged as much as 16.6 percent at one point, falling to $73.41. At the same time, equities slid sharply, with the S&P 500 falling to near two-week lows and the Nasdaq dropping to its lowest level in more than two months as enthusiasm around artificial intelligence cooled.
Analysts say the crypto market may now be entering a more painful phase. Some describe the current move as full capitulation rather than a routine pullback, warning that history suggests such resets can take months to fully play out.
The selloff has also weighed on shares of companies that hold bitcoin and other digital assets, raising concerns that turmoil in crypto markets could bleed further into traditional financial assets.
Another factor weighing on digital currencies is President Trump’s selection of Kevin Warsh as his pick for the next Federal Reserve chair. Markets have reacted to expectations that Warsh could move to shrink the Fed’s balance sheet, a shift that could pressure speculative assets. Cryptocurrencies have often benefited from abundant liquidity and large central bank balance sheets, rallying when money markets are flush.
Market watchers say fears of a more hawkish Federal Reserve stance are adding to the downside pressure. A smaller balance sheet, they argue, offers little support for crypto prices.
The sector has already been struggling since a sharp crash last October washed out leveraged positions and shook investor confidence. Since then, appetite for digital assets has remained fragile, particularly among institutional investors.
Analysts point to heavy outflows from exchange-traded funds as a major driver of the downturn. Billions of dollars have flowed out of institutional crypto ETFs each month since last fall, with U.S. spot bitcoin ETFs alone seeing more than $3 billion in outflows in January, following significant withdrawals in November and December.
That steady selling suggests traditional investors are pulling back, fueling growing pessimism around the asset class. With bitcoin closely tied to the tech sector, this week’s rout in software stocks has only intensified the pressure.
Some strategists are now warning that further declines could trigger forced liquidations among crypto miners, potentially setting off a vicious cycle. While many continue to argue that crypto should only be a small part of a diversified portfolio, its heavy ownership by retail investors means the fallout could add to broader market risk if the slide continues.
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