Singapore: Bitcoin, the world’s most widely followed cryptocurrency, plunged to its weakest levels in roughly 16 months on Friday, testing the critical $60,000 support level as investors increasingly moved away from speculative bets amid broad market stress. The dramatic price swings reflected heightened risk aversion across financial markets.
The digital currency briefly dipped to $60,008.52 before rebounding somewhat, trading near $64,153.24 in highly volatile sessions. Even with that partial recovery, Bitcoin’s losses for the year have mounted to about 27%, while weekly declines exceeded 15%, underscoring investor reluctance to maintain exposure to crypto’s notorious volatility.
The sell-off extended beyond Bitcoin. Ether, the second-largest digital asset, hit a roughly 10-month low before edging higher to around $1,891.27. The wider cryptocurrency market has shed nearly $2 trillion in value since peaking in October 2024, with over $1 trillion lost in just the past month, according to market data.
Market analysts attribute the sharp deterioration to a confluence of factors, including a global retreat from technology stocks and other high-risk assets. As speculative positions unwind, leveraged traders are being forced to exit positions, amplifying downward pressure on digital assets.
The current turmoil in crypto markets has mirrored broader risk-off sentiment sweeping financial markets. Volatility in equities and even traditionally safer investments such as precious metals has heightened, prompting investors to de-risk portfolios. Some strategists noted that Bitcoin’s decline appears correlated with weakness in tech sectors and other crowded trades that previously buoyed crypto prices.
“Bitcoin drifting back toward $60,000 is not crypto dying it is the bill coming due for traders that treated Bitcoin as a one-way asset without real risk controls,” said a market commentator, highlighting how overconfidence and excessive leverage have exacerbated the sell-off.
Weak sentiment has also shown up in institutional investment vehicles tied to cryptocurrencies. U.S. spot Bitcoin exchange-traded funds (ETFs) once seen as a major channel for long-term capital into Bitcoin have experienced sizeable outflows in recent months. Analysts noted that ETF investors have pulled billions, reflecting waning confidence and a more cautious stance toward crypto exposure.
This shift away from ETFs and other leveraged instruments has compounded selling pressure, with some market watchers pointing out that liquidity has thinned making price drops sharper and recoveries harder to mount.
With investor sentiment deteriorating and key technical support levels under threat, the outlook for cryptocurrencies remains murky in the near term. Some observers argue that if risk appetite does not return and macroeconomic uncertainties persist including monetary policy and global economic indicators the sell-off could deepen further before stabilizing.
Despite the near-term weakness, others suggest that significant corrections are a natural part of Bitcoin’s price cycles, and that patient investors may find opportunities once markets adjust to lower volatility and clearer fundamentals.