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Bitcoin sank below $65,000 on Thursday for the first time since 2024, wiping out all of the gains it had made since Donald Trump was elected to his second term as US president.
The world’s biggest cryptocurrency dropped 7 per cent to just above $64,000 as digital tokens were swept up in a sell-off in tech stocks. Bitcoin has lost more than a fifth of its dollar value this year.
“Sentiment has deteriorated sharply,” said Jasper De Maere, a strategist at trading firm Wintermute. “The crypto market still feels tired as we see little appetite from anyone to step in convincingly at these levels.”
Liquidations of leveraged bitcoin bets contributed to the downward spiral as traders who used significant leverage in their positions were forced to sell in order to meet margin calls — further depressing prices.
The price of ether, the second-largest coin, fell 11 per cent to $1,891, taking its decline this year to 36 per cent.
Bitcoin had rallied after Trump’s election victory, buoyed by his vow to make the US “the crypto capital of the world” and roll back a regulatory crackdown on the crypto industry.
Since taking office last year, the Trump administration has helped pass industry-friendly legislation while regulators lifted crypto enforcement actions, driving bitcoin’s price to a record high last summer of more than $125,000.
But since then, it has retreated as the wave of enthusiasm sparked by Trump began to wane and investors instead turned to precious metals as a long-term store of value, driving a record-breaking rally in gold and silver. Legislation governing the crypto industry in the US has also stalled this year.
The declines gathered pace this week amid an equity sell-off sparked by investors’ worries over the impact of AI on tech companies.
Shares in Michael Saylor’s bitcoin-hoarding company Strategy were 17.1 per cent lower on Thursday, down almost 30 per cent so far this year.
Bitcoin’s price drop has left the company with billions of dollars in paper losses. Saylor bought his 713,502 bitcoin for an average price of $76,052 by issuing equity and debt.
On X, Saylor posted “HODL” in the middle of the price spiral, a widely used crypto market slang term meaning “hold”. Strategy is set to report earnings after market close on Thursday.
Crypto exchange Gemini, co-founded by the twins Tyler and Cameron Winklevoss, said on Thursday it would lay off 200 employees and wind down some operations to cut costs. Its shares have fallen 80 per cent since it went public in September.
On prediction market platform Kalshi, traders began making bets last month on how low the price of bitcoin would fall this year. It shows a roughly 85 per cent chance that it will fall below $60,000.
