Bitcoin (BTC) Crashes to $78.3K, Losing All Gains from Trump's Pro-Crypto Policy Expectations.

Short-term Bitcoin holders panic, selling at losses exceeding $2 billion in days.

Crypto traders are getting increasingly concerned as Bitcoin (BTC) continues to fall, losing all the gains it made from the hype around President Trump’s pro-crypto policies.

After dropping below the $80,000 level on Tuesday, Bitcoin hit a four-month low of $79,263. The biggest cryptocurrency lost more than 5% in the last 24 hours.

One major reason for this drop is growing fear in the market due to President Trump’s tariff threats, which have created uncertainty in the economy. At the same time, the Crypto Fear and Greed Index fell to 21, its lowest level in nearly three years, highlighting the pessimism among investors.

Many of the recent Bitcoin losses come from short-term holders (STHs) who are panicking and selling their crypto at a loss. In the last three days alone, these holders have realized a total unrealized loss of $2.16 billion.

However, despite these losses, STHs are still sitting on unrealized gains of $3.4 trillion, which shows how much the crypto market grew in the past year.

Many new investors rushed into crypto in 2023, attracted by the market’s gains and hype around President Trump’s crypto plans. But with the market now moving sideways and Trump’s administration focusing more on trade issues, many are growing pessimistic.

Moreover, the U.S. Securities and Exchange Commission (SEC) recently stated that meme coins are not securities. While this may seem like good news, it has made the situation worse. Many meme coins heavily rely on hype and social trends, and with Bitcoin dropping, these coins crashed too, adding more panic to the market.

Another factor is that many crypto traders expected strong pro-crypto policies from President Trump, but things are moving slower than anticipated. No major crypto bill has been passed yet, and the administration is now focused on tariffs.

This has led to selling pressure on cryptocurrencies that gained from Trump’s support, further pushing down Bitcoin’s price.

If Bitcoin drops below the $76,000 level, it could fill a gap that formed on crypto exchange FTX. In the meantime, some traders believe that Bitcoin needs to fill this gap near the $80,000 level before recovering.

However, Crypto analyst AlphaBTC thinks that if Bitcoin fills this gap, it could start a new rally. But if it doesn’t, the price could fall further to $73,000.

At the same time, Bitcoin options data shows that more traders are betting on Bitcoin dropping to $70,000. This suggests that some investors believe the market could get even worse.