Bitcoin plunged to a three-and-a-half-month low on Friday, weighed down by investor uncertainty over U.S. President Donald Trump’s tariff policies, evolving cryptocurrency regulations, and waning confidence following a massive $1.5 billion hack of rival cryptocurrency Ether.
The world’s largest cryptocurrency by market capitalization dropped over 5% in a single day, reaching $79,666 and slipping below the $80,000 mark for the first time since November 11.
Read more: Bitcoin Drops 6% as Crypto Market Hits Multi-Month Lows
“Bitcoin’s dip below $80,000 signals that the optimism driven by a crypto-friendly administration and high-profile endorsements has faded,” remarked Joshua Chu, Co-Chair of the Hong Kong Web3 Association.
Since mid-December, when Bitcoin surged past $105,000 on hopes that the Trump administration would promote a strategic Bitcoin fund and relax regulations, it has lost nearly 25% of its market value. However, beyond appointing a few crypto-friendly officials, there has been little concrete action to support such expectations.
“The momentum stalled as no fresh developments emerged to sustain the bullish outlook,” noted Kyle Rodda, a senior financial market analyst at Capital.com.
In addition, Bitcoin’s decline aligns with a broader downturn in Wall Street tech stocks, particularly the “Magnificent 7” companies, where slowing momentum and declining valuations have impacted high-risk assets, including cryptocurrencies.
Ether, the second-largest cryptocurrency by market value, also saw a sharp decline, dropping nearly 6% to $2,149.38—its lowest level since January 2024.
Investors have also been withdrawing funds from Bitcoin-backed exchange-traded funds, further contributing to the decline.
Market sentiment has been rattled by growing concerns that the U.S. economy’s perceived strength may be waning, while Trump’s planned tariffs have fueled fears of increased global inflation and slower economic growth.
Trump has proposed imposing a 25% tariff on imports from Canada and Mexico starting in early March, along with additional duties on Chinese goods. In response, demand for safe-haven U.S. Treasury bonds has surged, driving yields to three-month lows.
Adding to the crypto sector’s woes, a major security breach at Bybit—the world’s second-largest cryptocurrency exchange after Binance—resulted in the theft of approximately $1.5 billion worth of Ether. The Dubai-based exchange, which serves over 60 million users globally, offers trading in Bitcoin, Ether, and other digital assets.
According to blockchain research firm Elliptic, this may be the largest recorded crypto theft to date.
“A combination of macroeconomic factors—including the Federal Reserve’s cautious stance on interest rate cuts, rising tariffs, geopolitical instability, and the Bybit hack—has dampened investor confidence,” said Reuben Conceicao, chief strategy officer at digital wallet provider Metasig. “With so many uncertainties, it’s difficult for investors to stay bullish on Bitcoin.”
