Bitcoin Plunges Below $85,000 in Major Crypto Market Rout
Bitcoin extended its nearly two-month decline on Monday, briefly dipping below $85,000 in a sharp sell-off that also hammered major crypto-related stocks. The drop reflects a broader risk-averse sentiment sweeping through technology and speculative assets.
Key Market Movers
- Bitcoin: Fell 6.5%, settling just above $85,000 after being down nearly 12% earlier. It is now down about 33% from its October record high of $126,210.50.
- Spot Bitcoin ETFs: Saw a massive $3.6 billion outflow in November—the largest monthly withdrawal since their launch in January 2024.
- Bitcoin Futures: Down nearly 24% over the past month, while gold futures have gained almost 7%.
Crypto Stocks Take a Hit
The sell-off battered companies across the cryptocurrency ecosystem:
- Coinbase Global: -5.4%
- Robinhood Markets: -4.4%
- Riot Platforms (mining): -2.8%
- Strategy (crypto treasury firm): -10%. The company holds 649,870 bitcoin, valued at about $55 billion as of Monday afternoon.
- American Bitcoin: -8.1%, now down over 41% since September 30. President Trump’s sons hold a stake in this firm.
Trump-Linked Crypto Assets Also Decline
Other ventures associated with former President Donald Trump have not been spared. The World Liberty Financial token ($WLFI) has seen its market value drop from over $6 billion in mid-September to about $4.14 billion. The meme coin $TRUMP is now trading at $5.67, a steep fall from its $45 price just before Trump’s inauguration in January.
What’s Driving the Sell-Off?
Analysts cite multiple factors behind the crypto market downturn:
- A broad “risk-off” sentiment pushing investors toward safer assets like bonds and gold.
- Institutional selling and profit-taking by long-term holders.
- A more hawkish stance from the Federal Reserve.
- Ongoing regulatory uncertainty in the United States.
“While volatility remains inherent, these conditions indicate Bitcoin’s portfolio integration is being tested, and raises questions of whether this is a temporary correction or a more prolonged adjustment,” wrote Deutsche Bank analysts in a recent note.
Regulatory Landscape: A Mixed Bag
The industry saw a positive development in July when former President Trump signed a law establishing initial rules for stablecoins. However, a more comprehensive bill to create a new market structure for cryptocurrencies remains stalled in the Senate, a key priority for an industry that spent heavily during the last election cycle.
The current correction tests Bitcoin’s resilience as a mainstream portfolio asset, with investors closely watching for signs of a bottom or further declines.
