Bitcoin Crashes Below $80,000, Erasing Almost All Gains Under Trump: Why Is Crypto Market Down?

Market sentiment has been shaken by Trump's tariff policies, regulatory concerns, and the recent $1.5 billion Bybit hack, eroding investor confidence.

The price of Bitcoin (BTC) fell below $80,000 on Friday, erasing almost all gains made after US President Donald Trump took office on a pro-crypto agenda. The world’s largest cryptocurrency was down 5.17 per cent in the last 24 hours, trading at $79,118.51 by 07:10 ET (11:10 GMT).

The market cap of Bitcoin stood at nearly $1,590 billion. Its 24-hour trading volume was $64.63B. Bitcoin is down by 5.17 per cent in the last 24 hours with a circulating supply of 19.83 million.

Why Is Bitcoin Falling?

A massive $106 million liquidation occurred as Bitcoin briefly hit $81,000, triggering further volatility.

"The cryptocurrency markets experienced a downturn as macroeconomic uncertainties and political events unfolded. Bitcoin, the leading cryptocurrency, plunged below the crucial support of $80,000 for the first time since November, wiping out nearly all gains since President Trump's victory, which was largely credited with the market's bullish run," said Avinash Shekhar, co-founder and CEO of Pi42.

"The decline in Bitcoin sentiment can be attributed to Trump's tariff policies, regulatory concerns, and the recent $1.5 billion Bybit hack, which has eroded investor confidence. Moreover, macroeconomic trends like inflation and interest rates also play a key role in influencing market sentiment," he added.

"As risk-off sentiment mounts, crypto investors should remain cautious about what lies ahead. The stage is set for a weekend of high-stakes trading as traders keep an eye on key technical levels and economic factors that could dictate Bitcoin's next move," Shekhar explained.

CoinDCX Research Team said in a note that the crypto market has entered a strong bearish phase as Bitcoin slumps below $80,000 for the first time since the November 2024 breakout. The other popular altcoins are also experiencing a similar sell-off but have been holding above their crucial support.

The institutions are playing a major role in the ongoing sell-off as Blackrock has been selling billions worth of BTC & ETH. Meanwhile, Litecoin is displaying some strength with the possibility of a quick rebound as the bulls continue to defend the local support at $120, it added.

"The tariff war escalated after President Trump announced an additional 10% tariff on China, which is believed to have impacted the crypto markets. After Uniswap & Gemini, the SEC ends an investigation on Consensys and drops a lawsuit on Coinbase, hinting towards clearer regulation on the horizon. On the other hand, the SEC stated that most of the memecoins do not qualify as securities, as the Howey Test keeps them out of the security rules mainly since they thrive on hype, not utility," CoinDCX Research Team said.