Market News

(Bloomberg) -- Almost half a trillion dollars has been wiped off cryptocurrencies in less than a week as a selloff led by Bitcoin accelerated.

Total crypto market value has slumped by $467.6 billion since Jan. 29, according to CoinGecko data. Bitcoin on Tuesday tumbled to its lowest level since US President Donald Trump won re-election in early November 2024 and ushered in a more crypto-friendly administration.

The original cryptocurrency, which hit a 15-month low of $72,877 in the US, regained some ground Wednesday and was trading at around $75,900 as of 6:05 a.m. in New York.

Despite a pro-crypto White House and surging institutional adoption, Bitcoin has plummeted about 40% since rocketing to a record in early October. The rout follows a crippling series of liquidations on Oct. 10 that wiped out $19 billion in leveraged token bets, from which the broader crypto market has yet to recover.

“Although there has been some rebound since the start of Wednesday, the sequence of lower local highs and lows indicates that selling on the rise prevails in the markets,” Alex Kuptsikevich, FxPro chief market analyst, said in a note.

The declines follow a volatile week across global markets that also saw sharp swings in gold and silver. While precious metals found buyers on Tuesday after recent losses, cryptocurrencies failed to attract support. Bitcoin and US equities fell as rising tensions between the US and Iran prompted investors to seek safe assets.

Bitcoin’s plunge is raising doubts that it functions as a kind of “digital gold,” as it hasn’t acted as a safe haven during a period of heightened geopolitical uncertainty. Investor Michael Burry this week warned that Bitcoin has been exposed as a purely speculative asset, failing to establish itself as a hedge similar to precious metals.

In the past 24 hours, over $700 million in bullish and bearish crypto bets have been liquidated in the perpetual futures market, taking the total wipeout to over $6.67 billion since Jan. 29, CoinGlass data shows.

Flows to US-listed Bitcoin exchange-traded funds remain choppy. After seeing about $562 million in net inflows on Monday, investors pulled out $272 million from the group on Tuesday, according to data compiled by Bloomberg.

Historically, there’s been a “tremendous amount” of near-religious belief in holding on to Bitcoin no matter what, Michael Novogratz, chief executive officer of Galaxy Digital LP, said on an earnings call. “And somehow that virus or that fever broke, and you started seeing some selling.”