Bitcoin has recovered from a low near $60,000 to now settle around $69,000, having effectively returned gains made following the election of Donald Trump in November 2024 this week.
The cryptocurrency’s decline was accompanied by a massive market sell-off that saw the CoinDesk 20 Index (CD20) lose more than 17% of its value in a week.
While bitcoin has fallen by around 16.5% over the past 7 days, other cryptocurrencies have fared worse. Ether lost 22.4% of its value, BNB by 23.4% and Solana by 25.2%. Shares of crypto-related companies saw significant declines despite a rebound on Friday, with the price of BTC briefly resuming $70,000.
The move follows a violent drop a day earlier that Wintermute described as bitcoin’s worst single-day drop since the FTX collapse.
The selling was driven by market-wide liquidations and what “looked like a ‘sell at all costs’ marching order,” Jasper De Maere, desk strategist and OTC trader at Wintermute said in an emailed statement.
De Maere said institutional offices reported a “light but manageable liquidation,” which does not fully explain the scale of the movement, fueling debate about where tensions fit into the system.
De Maere added that this cascade was accompanied by broader multi-asset deleveraging. The Nasdaq 100 tracker QQQ fell about 500 basis points over three sessions, while silver and gold fell about 38% and 12% below their cycle highs, respectively.
In crypto options, implied volatility has jumped to the 99th percentile, with a trend toward unusually expensive puts, he said.
De Maere singled out ether as the “epicenter of pain,” saying many traders rushed to buy protection against further losses using put options, which can pay off if prices fall and give the holder the right to sell at a fixed price. In the case of Bitcoin, he said the positioning indicated expectations of continued turbulence, with traders focusing on a wide range possibly from around $55,000 to $75,000.
Further hitting sentiment, crypto exchange Gemini this week announced plans to close its operations in the UK, European Union and Australia, and cut around 25% of its workforce as part of a restructuring. The company will enter withdrawal mode only for users in affected regions and will partner with brokerage platform eToro for users to transfer their assets.
Meanwhile, Bitfarms (BITF) saw its shares rise after shedding its identity as a “Bitcoin company” to instead focus on artificial intelligence (AI) infrastructure.
Market structure added to the turbulence. Bitcoin’s average market depth of 1%, a measure of how much can be traded at close to the current price without moving the market, has fallen to about $5 million from more than $8 million in 2025, Kaiko research analyst Thomas Probst told Reuters. Shallower depth can make price movements more abrupt.
Flows into spot bitcoin ETFs have also turned negative. SoSoValue data shows about $1.25 billion in net outflows over the past three days. Jim Bianco of Bianco Research estimated on social media that the average cost of an ETF is close to $90,000, leaving holders with about $15 billion in unrealized losses.
“Crypto is said to be a “programmable currency”. If so, BTC should trade like a software stock,” Bianco said in an article, adding that the recent decline shows that it is trading alongside software stocks.
Software stocks fell this week after Anthropic released a new automation tool for its AI models targeting legal and other knowledge-driven workflows. Shares of Salesforce (CRM), Adobe (ADBE), and ServiceNow (NOW) lost 8%, 9%, and 13%, respectively, during the week, to name a few.
Jonathan Krinsky, BTIG’s chief market technician, also said that bitcoin has been correlated with software stocks recently. “There is fairly compelling evidence of both of these [bitcoin and software stocks] We have reached tactical low levels,” Krinsky said in an interview with CNBC.[Bitcoin] bottomed around $60,000 last night, so I think that’s a pretty good level to trade against.
“On the upside, you really need to see it back above $73,000, that’s the key breakout level, that would kind of confirm that a tradable low is definitely there,” he added.
The Trump administration maintained a pro-crypto stance, which allowed the price of bitcoin to reach a new all-time high above $125,000 last year, before a correction took place.
