At 12:05 p.m. in Singapore, Bitcoin was down by 5.5% at $79,627, marking its lowest value since November 10. This decline was part of a wider selloff: Ether, the second-largest cryptocurrency globally, dropped by 7.3%, while smaller tokens such as Solana and XRP experienced losses of 7.1% and 7.8%, respectively.
The selloff highlights a rapid change in fortunes for digital assets, which surged following Trump’s electoral victory. Bitcoin achieved its peak value of $109,241 on January 20, coinciding with Trump’s inauguration day; however, it has since faced a downturn due to concerns surrounding the president’s aggressive policies and broader anxieties regarding the U.S. economy.
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“Given the macroeconomic environment, it’s not surprising to see the market position we’re in,” remarked Stefan von Haenisch, director of over-the-counter trading for Asia Pacific at crypto custody firm Bitgo Inc. He noted that traders are anticipating concrete actions from Trump, frequently viewed as a crypto ally, particularly concerning a potential Bitcoin stockpile.
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The downturn aligns with a broader risk-off mentality among Asian investors, who sold off shares following Trump’s recent announcements regarding tariffs. The president indicated that 25% tariffs on Canada and Mexico would commence on March 4, while Chinese imports would incur an additional 10% tax. The MSCI AC Asia Pacific Index fell by around 2%.
This bearish sentiment has also impacted spot U.S. Bitcoin exchange-traded funds, with investors withdrawing over $1 billion on Tuesday, marking the most significant one-day outflow since their launch last year.
Purchasing Bitcoin has been a favored ‘Trump trade’ after the U.S. election. The president has expressed a desire to establish the U.S. as “the crypto capital of the planet and the Bitcoin superpower of the world,” prompting investors to flock to Bitcoin post-election in the expectation he would fulfill that promise.
Traders are now compelled to evaluate how far the leading cryptocurrency could potentially decline. According to Ruslan Lienkha, chief of markets at the crypto platform YouHodler, there is technical support for Bitcoin around the $70,000 mark. However, he advised that investors should not automatically assume the Bitcoin downtrend would reach that point.
“This level will only manifest if negative sentiment prevails in the equity markets,” Lienkha stated.
Trump has already implemented several critical changes that have satisfied crypto advocates. He has appointed crypto supporters to significant roles, and the Securities and Exchange Commission, which initiated an extensive crackdown under former Chair Gary Gensler, has recently terminated investigations into multiple crypto companies.
