Bitcoin approached the $72,000 mark on Wednesday, continuing its significant decline for the second consecutive day. The world’s leading cryptocurrency dropped to as low as $72,096.20, reflecting a decrease of over 5% on the day, with its last recorded price at approximately $72,958.38, down about 4%. This downturn puts Bitcoin more than 40% below its all-time high of nearly $126,000 achieved last October.
On Tuesday, Bitcoin fell below the $73,000 threshold, marking its lowest value in around 16 months and nearing its pre-election price point. Analysts at Citi have indicated that the $70,000 level is crucial to observe as the cryptocurrency’s slide continues, driven by various geopolitical and economic challenges. Key factors include a shift in investor sentiment away from riskier assets amid escalating tensions between the U.S. and Europe, largely due to President Donald Trump’s Greenland initiative. Additionally, a recent partial government shutdown delayed the release of important economic data.
Expectations surrounding U.S. monetary policy changes—particularly following Trump’s appointment of Kevin Warsh as Federal Reserve chair—are influencing market behavior. Moreover, a growing trend of institutional withdrawals in anticipation of further price corrections has dampened liquidity for Bitcoin. Recent data from Deutsche Bank highlighted that spot Bitcoin exchange-traded funds have faced significant outflows, with more than $3 billion in January alone following a series of liquidations of leveraged digital asset positions.
The impact of this decline is evident, as several cryptocurrency-related stocks have also suffered. Notably, Strategy, a Bitcoin treasury firm, experienced a 5% drop, while mining companies like Riot Platforms and MARA Holdings saw declines approaching 11%.
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