Bitcoin (BTC) Market Took a Major Hit on Friday, Wiping Out Nearly All the Gains From Earlier This Week

The crypto market took a major hit on Friday, wiping out nearly all the gains from earlier this week. Bitcoin, which was hovering close to $88,000, plunged to $83,800

The crypto market took a major hit on Friday, wiping out nearly all the gains from earlier this week. Bitcoin fell 3.8% in just 24 hours to $83,800 from a high of $88,000, while major altcoins like Avalanche (AVAX), Polygon (POL), Near (NEAR), and Uniswap (UNI) lost almost 10%.

The crypto market lost a staggering $115 billion in value as a result, and saw its worst daily performance since November 2023. Moreover, Ethereum struggled, dropping over 6% and hitting its weakest price against Bitcoin since May 2020.

Unlike Bitcoin ETFs, which have seen over $1 billion in inflows over the last two weeks, Ethereum ETFs failed to attract new investments since early March. This lack of interest adds to concerns about ETH’s performance compared to BTC.

How Are U.S. Stocks and Economic Woes Impacting Crypto?The downturn wasn’t just limited to digital assets. The broader U.S. stock market also saw a sharp decline following the release of weak economic data. The S&P 500 fell 2%, marking its biggest one-day loss since January 12, while the Nasdaq dropped 2.8%.

Crypto-related stocks suffered even more, with MicroStrategy (MSTR), the largest corporate holder of Bitcoin, losing 10% and Coinbase (COIN) falling 7.7%.

The February inflation report showed a 2.5% year-over-year rise in the price index, with core inflation at 2.8%, slightly above expectations. Consumer spending grew only by 0.4%, and adjusted figures indicate weak economic growth.

The Federal Reserve’s GDPNow model now predicts the U.S. economy could shrink by 2.8% in the Q1, and new U.S. tariffs set to take effect on April 2 have added to investor concerns.

Was This Bitcoin Price Crash Expected?Bitcoin’s drop to $84,000 was anticipated due to the CME futures gap from earlier this week. Historically, BTC tends to revisit these gaps, and this pullback was likely.

However, with Bitcoin closely following the Nasdaq’s movements, a continued downturn in U.S. stocks could lead to further losses in crypto. But Santiment notes that while global stock markets, including the S&P 500, faced sharp declines due to tariff and inflation concerns, Bitcoin managed a slight weekly gain, remaining above $84,300.

A mild BTC rebound after the stock market’s close hints at crypto’s growing independence from equities, contrasting with their strong correlation during the 2022 bear market.

Despite the ongoing correction, some experts see long-term positives. Joel Kruger, a strategist at LMAX Group, pointed out that crypto adoption is growing, with major financial institutions expanding their involvement.

While more short-term dips could occur, Kruger expects strong support around the $70,000–$75,000 range, making a potential recovery later this year more likely.

On the Downside…Crypto analyst Michaël van de Poppe warns that Bitcoin is losing momentum, with key liquidity levels below $84K at risk. If BTC breaks this support, further declines could follow.

He suggests another week of drops might be on the way as we approach the second quarter, setting the stage for a potential rebound.