Bitcoin (BTC) price falls below $80,000 as euphoria surrounding Donald Trump's pro-crypto policies fades

Bitcoin has fallen below the psychologically crucial $80,000 mark as the euphoria surrounding Donald Trump's pro-crypto policies fades

The euphoria surrounding Donald Trump’s pro-crypto policies has faded, leading to a decline in major digital assets from their post-election peaks, with the world’s largest cryptocurrency, Bitcoin, falling below the crucial $80,000 mark.

Bitcoin erases post-election gains

Bitcoin fell 8.2% in the 24 hours to 1:30 pm IST, extending its downturn from January peaks. The cryptocurrency is now down 21% from the highs reached shortly after Trump’s November election victory.

Other cryptocurrencies suffered sharper declines, with Ether losing over 40% since December. Trump’s own meme coin, launched days before his inauguration despite conflict-of-interest concerns, plunged 80% from peaks, it further highlighted.

Bitcoin price slipped below crucial $80K mark

As the dust settles on the U.S. election, the crypto market continues to recalibrate expectations. With the Federal Reserve seen in no rush to cut interest rates despite recent economic weakness, investors are awaiting either a clear bullish signal or macroeconomic risk aversion to return.

The former would likely be triggered by a Fed rate cut or, on the regulatory front, more concrete pro-crypto policies from the Trump administration.

Trump’s campaign promises, which included establishing a national Bitcoin reserve and easing regulations, initially sparked a strong rally. However, while his administration has taken steps—such as dropping an SEC lawsuit against Coinbase (NASDAQ:COIN) and halting probes into crypto firms—analysts say these moves have failed to provide lasting support for prices.

“The market is disappointed,” said James Butterfill, head of research at CoinShares. “Until we get clarity on a Bitcoin reserve, I can’t see prices recovering significantly.”

Insiders’ view

“The initial excitement surrounding the Trump administration’s perceived pro-crypto stance appears to be in a phase of recalibration. For sentiment to shift decisively, a clearer regulatory framework or a major catalyst—such as further ETF approvals—seems necessary,” said Gabe Selby, Head of Research at CF Benchmarks.

Since December, nearly $1 trillion in market value has been wiped out, bringing total crypto capitalisation to $2.76 trillion, CoinMarketCap data showed.

Asset managers, including BlackRock (NYSE:BLK), have been offloading billions of dollars’ worth of Bitcoin and Ether, as part of broader portfolio adjustments, especially amid rising macroeconomic uncertainty.

However, filings indicate that sovereign wealth funds and banks are still buying. Abu Dhabi’s Mubadala Investment Co has disclosed a $436.9 million stake in BlackRock’s iShares Bitcoin ETF.

Cryptocurrencies have also been hit by Trump’s trade war, with his recent 10% tariff hike on China dulling the appetite for speculative assets.

Meanwhile, regulatory clarity may be emerging, with the SEC dropping its lawsuit against Coinbase and ruling that most meme coins do not qualify for securities status.

Bitcoin had surged past $75,000 on November 6, 2024, following Trump’s election win and a wave of ETF inflows. It peaked at $109,350 in January 2025, before entering its current downturn.

Despite the slump, Standard Chartered analyst Geoff Kendrick remains bullish, sticking to his prediction that Bitcoin could hit $500,000 before Trump leaves office. Kendrick’s optimism is based on his belief that fresh institutional demand, especially from sovereign wealth funds and banks, will drive the next leg of Bitcoin’s rally.