Bitcoin (BTC) Has Plunged to $80,000, Wiping Out $200 Billion from the Crypto Market

Bitcoin has plunged to $80,000, wiping out over $200 billion from the crypto market in one of the worst single-day crashes in a year.

Crypto traders were scrambling to hedge deeper losses as volatility surged and put contracts saw rising demand, data from Coinglass showed.

The crypto market saw more than $200 billion wiped out in one of the worst single-day crashes of the year, as Bitcoin plunged below the $80,000 level.

The sell-off came after U.S. President Donald Trump signed an executive order to launch the Strategic Bitcoin Reserve.

Traders had largely priced in a bullish rally following the announcement of the White House Crypto Summit, but the market went in the opposite direction.

Bitcoin dropped from around $90,000 to $85,000 within minutes after the move, while the White House event had little impact after Trump’s surprising announcement.

The crypto market lost nearly 10% in the morning hours on Friday, signaling a brutal reaction from traders.

Trump’s participation in the summit was brief, and he did not introduce any new crypto policies during his time at the event. Instead, industry leaders praised his administration’s progress on crypto.

However, the event did not do enough to instill market confidence, which had been battered by a broader macroeconomic downturn.

Economist Peter Schiff slammed the summit as a disgrace and said it was clear the White House had been captured by crypto interest groups.

Meanwhile, concerns over the U.S. economy continue to mount, with a $9.2 trillion debt refinancing crisis set to hit in 2025, putting immense pressure on interest rates and fiscal policy.

The 10-year Treasury yield has also slid by 60 basis points over two months, signaling rising recession fears.

Elon Musk’s Department of Government Efficiency is aiming to cut $2 trillion in spending, but progress has been slow.

Trump has also pressured OPEC to lower oil prices in a bid to help curb inflation, but the threat of a recession continues to grow.

The Atlanta Fed slashed its Q1 2025 GDP estimate to -2.8%, according to an analysis from The Kobeissi Letter, raising concerns about the U.S. economic stability.

Traders are now anticipating Fed rate cuts, but inflation remains a major roadblock. Inflation expectations surged to 6.0%, the highest since May 2023, casting further doubts on imminent rate cuts that could support Bitcoin’s price recovery.

Bitcoin is now trading around $80,909, down more than 6% for the day and 3.37% for the week. Trading volume plummeted by 53%, despite a massive 22,000 BTC accumulation from BTC whales over three days.

Analysts are expressing surprise at the cryptocurrency’s decline, given the week was jam-packed with bullish news, culminating in the announcement of the Strategic BTC Reserve.

However, macroeconomic news, including new U.S. tariffs and a concerning non-farm payrolls report, have intensified selling pressure.

Market watchers anticipate BTC could retest the $78,000 level, with $75,000 emerging as the next significant support zone.

BitMEX co-founder Arthur Hayes has issued a stark warning of a violent move if BTC falls into the $70K-$75K range, as mentioned by Arthur in his recent post on X.

CryptoQuant data reveals that exchange reserves are quickly depleting, suggesting an impending supply shock. Nevertheless, panic selling has taken precedence over macroeconomic fundamentals.

Despite the cryptocurrency downturn, El Salvador’s President Nayib Bukele remains focused on buying the dip, adding five more BTC to the country’s crypto holdings.