The euphoria spurred by President Donald Trump’s push to make the US a global crypto capital has quickly reversed, with digital assets sitting lower now than when he took office.
It took just over a month for cryptocurrencies to erase almost all of this year’s market value gains.
At its Oct. 6 peak, the total market value of all cryptocurrencies touched a record of nearly $4.4 trillion, but a 20% decline since then leaves asset class up a modest 2.5% for the year, according to CoinGecko data. The downturn that began with the sudden liquidation of about $19 billion in leveraged positions just days after the all-time high shattered confidence, and traders show few signs of betting on a rebound.
That performance is a shock few would have predicted in a year defined by a tighter embrace of digital assets by regulators, global banks and institutional investors.
President Donald Trump’s push to cement the US as the world’s crypto epicenter unleashed a wave of activity and sent Bitcoin climbing as much as 35%. In a sign of how quickly sentiment has reversed, the market value of digital assets is now lower than when Trump took office.
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Bitcoin has fallen 9% so far this week, putting it on track for its worst weekly performance since March. In the process, it dropped below its 200-day moving average, a closely watched level of support that has held since the 2022 bear market. Bitcoin was trading just below $100,000 as of 12:30 p.m. in London on Friday.
While the recent selloff has been broad, the sharpest losses have been concentrated in altcoins — smaller, more volatile tokens — which have underperformed significantly this year.
“Excluding Bitcoin and Ether, crypto has largely been trading on the backfoot for months,” said Augustine Fan, a partner at SignalPlus. “There’s been little new money flowing into alt-tokens or DeFi projects.”
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With few near-term catalysts and persistent concerns over security and regulation, mainstream participation is likely to remain weak, Fan added.
Jeff Mei, chief operating officer of crypto exchange BTSE, said the latest dip in digital assets was partly driven by “concerns that AI stocks are severely overvalued.” He warned that “if we see a selloff in AI and tech stocks, then it’s very likely that Bitcoin could fall below the $100,000 mark and altcoins could fall even further.”
Despite the gloom, there are some signs of stabilization. After six consecutive days of net outflows, US spot Bitcoin and Ether ETFs saw $253 million in inflows on Thursday.
