Popular cryptocurrency Bitcoin is not doing so well. Bitcoin was on the cusp of breaking below the key $70,000 level on Thursday as a slide in the world’s largest cryptocurrency showed no signs of stopping.
“The market fears a hawk with him,” said Manuel Villegas Franceschi from the next generation research team at Julius Baer. “A smaller balance sheet is not going to provide any tailwinds for crypto.”
Bitcoin fell 2% in early European trade, having dropped as much as 3.5% earlier during the Asian session to $70,052.38, its lowest level since November 2024.
Analysts attribute the drop to a combination of macroeconomic factors, including expectations for U.S. monetary policy, fluctuating investor sentiment, and increasing regulatory scrutiny in major markets.
During the Asian trading session, Bitcoin lost more than 3 % and was trading just above $70,000, marking its weakest level since late 2024. Some trading platforms briefly recorded prices below the $70,000 threshold, highlighting the intensity of the selling pressure. This development is significant because $70,000 has historically acted as both a psychological and technical support level, with many traders using it as a reference point for market entry or exit decisions.
Market observers are watching closely to see whether Bitcoin will stabilize around this level or continue its downward trajectory. A breach below $70,000 could prompt further short-term selling, while a rebound might signal renewed confidence among institutional and retail investors, influencing the broader cryptocurrency market.
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Ether, meanwhile, was down 0.7% at $2,111.34. A drop below $2,000 would mark the first time the world’s second-largest cryptocurrency has breached that level since May last year.
The recent fluctuations in Bitcoin and other cryptocurrencies highlight the inherent volatility and sensitivity of digital assets to macroeconomic conditions, investor sentiment, and regulatory developments. Markets for cryptocurrencies remain highly reactive to signals from central banks, changes in fiscal or monetary policy, and broader economic uncertainty, which can quickly influence investor behavior.
Investor psychology plays a critical role in cryptocurrency markets. Rapid price swings, particularly around well-known support or resistance levels, can trigger herd behavior, amplifying market movements in either direction. Market participants often watch these levels closely, and sentiment-driven reactions can compound technical trends, creating feedback loops that accelerate volatility.
Regulatory oversight is another important factor shaping the landscape. As governments and financial authorities increasingly scrutinize digital assets, market participants must navigate evolving rules that may affect trading, investment practices, and market access. These dynamics make the cryptocurrency ecosystem highly unpredictable in the short term.