The downward trend in the prices of the world’s largest cryptocurrency shows no sign of easing, as Bitcoin on Thursday neared a fall below the $70,000 level.
During the Asian session, Bitcoin dropped by more than 3% to $70,052.38, marking its lowest level since November 2024.
The world’s second-largest cryptocurrency, Ether, also declined by nearly 2% to $2,086.11. If it falls below $2,000, it would be the first time since May last year.
Analysts say the recent sharp and rapid sell-off in cryptocurrencies has been driven by the nomination of Kevin Warsh as the next Federal Reserve chair. There are concerns that he may move to reduce the Federal Reserve’s balance sheet (assets).
Bitcoin has fallen by more than 7% so far this week, pushing its total losses for the year to nearly 20%. Meanwhile, Ether has dropped by around 30% year-to-date.
Cryptocurrencies are generally believed to benefit from a large Federal Reserve balance sheet, as liquidity injections that keep money markets flowing have historically supported prices of speculative or higher-risk assets.
