Key Points:
- Bitcoin dropped below $80,000 for the first time since April 2025.
- The crash coincided with a broader stock market drop led by Microsoft.
- Forced liquidations wiped out over $2 billion in crypto positions since Thursday.
- Uncertainty surrounds Kevin Warsh’s nomination as the next Federal Reserve chair.
Bitcoin is having a rough start to the week, hovering around $78,000 on Monday morning. This comes after a brutal weekend where the price dipped below $80,000 for the first time since April 2025. At one point, the world’s largest cryptocurrency even sank to nearly $74,000 before recovering slightly. In just seven days, the market has lost about 12%, wiping out over $200 billion in value.
The crash wasn’t just about crypto; it seems to be part of a bigger panic in global markets.
On Friday, U.S. stocks took a hit, led by a 10% drop in Microsoft shares after a disappointing earnings report. That fear spread to precious metals, with silver crashing 30% and gold also tumbling significantly. When investors get scared, they tend to sell risky assets like Bitcoin first, and low trading volume over the weekend made the price swings even more violent.
Making matters worse were forced liquidations. This happens when traders who borrowed money to bet on Bitcoin run out of cash to cover their losses, forcing exchanges to automatically sell their coins. Since Thursday, over $2 billion in positions were wiped out. This creates a domino effect, pushing prices down even faster as more sell orders hit the market.
Investors are also nervous about leadership changes at the Federal Reserve. President Trump recently chose Kevin Warsh to replace Jerome Powell as Fed chair, adding a layer of uncertainty to the economic outlook. Data shows that investors pulled $1.7 billion out of digital asset funds last week, a clear sign that confidence is shaking.
So, where does the price go from here? Some analysts think Bitcoin might find a stable floor around $70,000. However, others are much more pessimistic. John Blank from Zacks warned that if history repeats itself and follows the pattern of previous “crypto winters,” Bitcoin could plummet all the way to $40,000 this year.
Since hitting a record high of $126,000 in October, the coin has been on a painful downward slide, leaving traders wondering when the bleeding will stop.
