adminRisk-off moves
Bitcoin (BTC-USD) dropped below $80,000 overnight, losing more than 25% since its record high on January 20 – the day of President Trump’s inauguration – in a dramatic price correction, as looming tariffs drive safe-haven demand. Other cryptocurrencies have also been weighed by the prevailing global risk-off sentiment, and crypto-related stocks are expected to see some pressure.
Fading hype: Bitcoin had been one of the most popular Trump trades, given expectations of a friendlier regulatory environment under the new administration. But investors are now moving towards safer assets as Trump ramps up his tariff threats. “Instead of serving as an alternative to fiat instability, as its proponents have long claimed, crypto has once again been treated like other high-risk assets and sold off accordingly,” SA analyst TMC Research noted in a recent analysis.
If the risk-off sentiment continues, bitcoin could lose all its gains from the post-election rally and outflows from crypto ETFs could swell further. Tuesday alone saw more than $1B pulled out of spot bitcoin ETFs, the largest single-day cash exodus for the ETFs since their debut in last January. The crypto fear and greed index, which tracks trader sentiment in the sector, is now flashing “Extreme Fear.”
Hope remains: Still, crypto bulls are hopeful that bitcoin will rebound soon and a bottom for its price is nearing. Geoffrey Kendrick, head of digital assets research at Standard Chartered, told CNBC on Thursday that he still expects the top crypto to reach $200,000 this year as the industry sees more institutionalization and regulatory clarity.
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