Crypto market sheds $500 billion in a week as Bitcoin tumbles
In less than a week, the cryptocurrency market has witnessed a staggering loss of nearly half a trillion dollars, driven by a Bitcoin-led selloff that is intensifying. According to data, the total market capitalisation of cryptocurrencies has seen a significant decline of $467.6 billion since January 29. On Wednesday, Bitcoin saw a rebound of 1.31%, reaching a price of $76,681.72. The largest cryptocurrency experienced a significant drop, hitting a 15-month low of $72,877 on Tuesday — a level reminiscent of early November 2024, during US President Donald Trump’s re-election campaign, when hopes for a more crypto-friendly policy environment were elevated. Bitcoin has experienced a decline of 13% year-to-date and has plummeted 39% from its peak of over $126,000 on October 6.
A report indicates that the losses follow a volatile week in global markets characterized by significant swings in gold and silver prices. While precious metals experienced a surge in buying interest on Tuesday after recent downturns, cryptocurrencies continued to face significant pressure. Bitcoin experienced a downturn as rising tensions between the US and Iran prompted investors to seek refuge in traditional safe-haven assets. Market experts indicate that currency movements and interest rate differentials are subtly shaping market behavior, impacting leverage, stablecoin flows, and the overall sentiment. Avinash Shekhar states that Bitcoin’s recent dip below the $73,000 threshold, marking its lowest point since November 2024, indicates significant selling pressure as the markets respond to ongoing uncertainty. “While selling activity has intensified over the past 48 hours, the decline does not appear driven by a single catalyst but rather a combination of positioning resets and broader market nervousness,” Shekhar stated.
Nischal Shetty stated that global macro developments have underscored the fact that liquidity conditions are still influencing short-term movements in the crypto markets. As certain regions continue to favor stricter monetary policies, capital flows are characterized by selectivity and caution. This environment has resulted in cryptocurrencies being closely tied to the performance of broader risk assets, with market participants responding more to macroeconomic indicators than to developments specific to the crypto space, as noted by Shetty. He added that even small macro changes are translating into sharper price reactions due to relatively thin liquidity. Shekhar noted that liquidation pressure in the crypto market continues to be a near-term concern, but prices are still maintaining levels above longer-term structural supports. “If this zone stabilizes, the market may look to consolidate before attempting a recovery, though volatility is likely to persist until clearer macro signals emerge,” he stated.
In the latest developments, Shetty pointed out that there is a noticeable shift in emphasis towards sustainable engagement in the crypto space, with growing interest in yield- and infrastructure-driven use cases. “While prices remain range-bound in the near term, the market continues to mature beneath the surface, responding, adapting, and building through changing global conditions,” Shetty stated. According to the technical analysis, the $73K level remains a crucial downside support. For a significant enhancement of the short-term trend and to reinstate bullish momentum, a sustained reclaim of the $77.5K–78K resistance zone is essential.
