Bitcoin Drops 25% From Record High as Crypto Market Selloff Escalates in US

Bitcoin’s price dropped as much as 7.2% on Friday, hitting its lowest level since early November. The cryptocurrency has now lost nearly 27% of its value in just six weeks after reaching an all-time high of $109,241 in January.

The selloff is part of a broader decline in the cryptocurrency market, with major digital assets such as Ether, Polkadot, and XRP also experiencing sharp losses. Investors are pulling back from riskier assets as economic concerns and market uncertainty grow.

Trade War Fears Spark Panic Across Markets

The renewed drop in Bitcoin follows rising concerns over the U.S. administration’s trade policies. A 25% tariff on imports from Canada and Mexico is set to take effect on March 4, reversing expectations of a policy rollback. Meanwhile, an additional 10% levy on Chinese goods has further strained relations between Washington and Beijing.

These trade tensions have sparked a selloff across global markets, dragging down stocks and cryptocurrencies alike. Investors worry that higher tariffs will drive up costs, fuel inflation, and slow economic growth, leading to a shift away from riskier investments.

Bitcoin’s Rally Unwinds as Sentiment Shifts

Bitcoin’s record-breaking run in January was driven by optimism that regulatory changes and mainstream adoption would boost long-term growth. However, the recent pullback suggests that those expectations may have been premature.

Market sentiment has shifted in recent weeks as concerns over inflation, interest rates, and economic uncertainty overshadow previous optimism. Bitcoin, which has often been seen as a hedge against financial instability, is now facing renewed doubts about its role in uncertain times.

Massive Outflows From Bitcoin ETFs Add to Pressure

Investor confidence in Bitcoin has been further shaken by large withdrawals from U.S. Bitcoin exchange-traded funds (ETFs). On Tuesday alone, more than $1 billion was pulled from these funds—the largest single-day outflow since their launch.

Institutional investors had been a driving force behind Bitcoin’s recent surge, but their retreat suggests a growing sense of caution. If these outflows continue, Bitcoin could face even steeper declines in the near future.

Will Bitcoin Stabilize or Continue to Decline?

Market analysts are closely watching Bitcoin’s price movements to determine the next key support level. Some experts suggest that Bitcoin could stabilize around $70,000, while others warn that further declines are possible if negative sentiment persists.

The broader outlook for Bitcoin and the cryptocurrency market will depend on economic trends, trade policies, and regulatory developments. Investors will be monitoring Federal Reserve decisions, inflation data, and market reactions in the coming weeks to gauge whether Bitcoin can recover or if the selloff will continue.

Also Read: Bitcoin Dips Below $90K – Key Support and Resistance Levels to Watch