Bitcoin hits $79,000—lowest level since Trump's return as President
What's the story
The cryptocurrency market is witnessing a major sell-off, led by Bitcoin and Ether.
Bitcoin fell more than 3% to nearly $79,000—the lowest its been since Donald Trump won the US election in November 2024.
Ether's value dropped as much as 6% to $1,756, an intra-day low not seen since October 2023.
The cryptocurrency slump was primarily driven by a massive sell-off in the US equity market. The Nasdaq 100 Index experienced its worst day since October 2022, plunging nearly 4%.
Initiative impact
Trump's Bitcoin reserve initiative fails to boost market sentiment
Trade war and recession fears, driven by President Trump's policies, triggered a sharp market decline and investor panic. The selloff erased $4 trillion from the S&P 500's February peak.
Notably, President Trump had earlier ordered the creation of a US Bitcoin reserve and a separate stockpile of other tokens.
This was announced ahead of a high-profile crypto summit with industry executives in Washington last week.
However, despite these moves, the market sentiment remained largely unaffected by his actions.
Market analysis
Bitcoin's correlation with equities reaches new heights
Joshua Lim, co-head of markets at FalconX Global, weighed in on the current state of the cryptocurrency market.
He said, "Now that the industry has its strategic Bitcoin reserve executive order, crypto has one fewer positive forward catalyst to price in."
He added, "Bitcoin's correlation to equities is climbing to levels not seen since August 2024's yen carry trade unwind."
ETF performance
ETFs linked to digital assets suffer significant losses
Exchange-traded funds (ETFs) promising enhanced returns on digital assets or crypto-linked themes were among the biggest losers in market-wide sell-off.
Two ETFs used to make leveraged bets on Strategy—the Bitcoin-holding company formerly known as MicroStrategy—fell more than 30% for the day.
This further highlights the impact of the equity market downturn on cryptocurrencies and related investment vehicles.