Bitcoin has fallen below the psychologically crucial $80,000 mark as the euphoria surrounding Donald Trump’s pro-crypto policies fades, with major digital assets erasing most of their post-election gains.
The world’s largest cryptocurrency is down 21% from its January peak, retreating to levels seen shortly after Trump’s election victory in November. At 01:30 pm IST, Bitcoin was trading 8.2% lower, CoinMarketCap data showed.
Other cryptocurrencies have suffered sharper declines, with Ether losing more than 40% since December. Trump’s own meme coin, launched days before his inauguration despite conflict-of-interest concerns, has plunged 80% from its peak, it further highlighted.
Market recalibrates expectations
The market remains subdued as investors await a clear bullish signal—either a Federal Reserve rate cut or concrete pro-crypto regulations from the Trump administration, Reuters reported.
Trump’s campaign promises, including establishing a national Bitcoin reserve and easing regulations, sparked an initial rally. However, while his administration has taken steps—such as dropping an SEC lawsuit against Coinbase and halting probes into crypto firms—analysts say these moves have failed to support prices.
“The market is disappointed,” Reuters quoted James Butterfill, head of research at CoinShares, as saying. “Until we get clarity on a Bitcoin reserve, I can’t see prices recovering significantly.”
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Gabe Selby, Head of Research at CF Benchmarks, told Reuters, “The initial excitement surrounding the Trump administration’s perceived pro-crypto stance appears to be in a phase of recalibration. For sentiment to shift decisively, a clearer regulatory framework or a major catalyst—such as further ETF approvals—seems necessary.”
Institutional sell-off and macroeconomic risks
Since December, nearly $1 trillion in market value has been wiped out, bringing total crypto capitalisation down to $2.76 trillion, CoinMarketCap data shows.
Institutional investors are playing a key role in the sell-off. News18 reported that asset managers, including BlackRock, have offloaded billions worth of Bitcoin and Ether. However, filings indicate that sovereign wealth funds and banks are still buying, with Abu Dhabi’s Mubadala Investment Co revealing a $436.9 million stake in BlackRock’s iShares Bitcoin ETF, Reuters report pointed out.
Litecoin is showing some resilience, with bulls defending the $120 support level, CoinDCX Research told News18.
Adding to market uncertainty is Trump’s trade war. His recent 10% tariff hike on China has dampened appetite for speculative assets. Meanwhile, regulatory clarity may be emerging, with the SEC dropping its lawsuit against Coinbase and ruling that most meme coins do not qualify as securities.
Bitcoin had surged past $75,000 on November 6, 2024, following Trump’s election win and a wave of ETF inflows. It peaked at $109,350 in January 2025, before entering its current downturn.
Despite the slump, Standard Chartered analyst Geoff Kendrick remains bullish, sticking to his prediction that Bitcoin could hit $500,000 before Trump leaves office. His optimism hinges on fresh institutional demand, particularly from sovereign wealth funds and banks, Reuters added.
(With agency inputs)
