Bitcoin tumbled to its lowest level since Trump returned to the White House on Tuesday, completely erasing the gains the flagship digital asset had accumulated since the U.S. presidential election. Despite the Trump administration's friendly stance towards cryptocurrencies and a surge in institutional adoption, Bitcoin has fallen more than 40% since hitting its all-time high in October 2025.
Data from CoinMarketCap showed a broad acceleration in the sell-off across cryptocurrencies during Tuesday's U.S. midday trading. Bitcoin once fell below $73,000, dropping more than $6,000, or nearly 8%, from its intraday high above $79,100 reached in the early Asian session, hitting its lowest level since early November 2024, after Trump's election victory.
Ethereum, the second-largest cryptocurrency by market cap, saw an even steeper decline. It once fell below $2,110 during U.S. midday trading, hitting its lowest level since May 2025, down just over 10% from its daily high above $2,350 in the early Asian session.
Although Bitcoin quickly recovered above $74,000, it has still accumulated a loss of over 15% since the start of 2026. Investor concerns about economic headwinds continue to intensify, with stocks struggling to rebound amid low risk appetite and fears of an AI bubble, pushing cryptocurrency market sentiment to rock bottom. Augustine Fan, a partner at Hong Kong crypto options platform SignalPlus, said: "Crypto sentiment is hitting a bottom, and the market is trading in bear market mode."
On Tuesday, Bitcoin broke below the year's low of under $74,500 set on April 7, 2025, which was triggered by Trump's so-called reciprocal tariff plan that shocked global financial markets.
Bohan Jiang, a senior derivatives trader at FalconX, said: "Many traders tried to buy the dip, betting on a bounce back above $80,000. As Bitcoin continued to fall, a large number of positions were liquidated, putting pressure on the price."
The cryptocurrency market has been under sustained downward pressure since the sell-off in October 2025. Additional comments from Trump on tariffs at that time triggered a severe wave of liquidations, wiping out $19 billion in leveraged token bets, from which the broader crypto market has yet to recover. Apart from the price turmoil in April, Bitcoin had largely held above $75,000, a level reached the day after Trump's re-election.
Institutions Hold Firm but Retail Exits
While some institutional holders remain steadfast, retail participation has declined as major long-term Bitcoin holders sold off assets worth billions of dollars.
So-called altcoins have significantly underperformed Bitcoin and Ethereum. The MarketVector Digital Assets 100 Small-Cap Index, which tracks the 50 smallest assets among the top 100 digital assets by market cap, has plummeted nearly 70% over the past year. Since Bitcoin and Ethereum gained U.S. exchange-traded product approval and attracted institutional capital, other cryptocurrencies have consistently underperformed. However, spot ETFs for these assets—a large portion of which are held by retail investors—saw outflows of billions of dollars in November.
Morten Christensen, a trader operating AirdropAlert.com, said: "Bitcoin is still trading like a high-beta risk asset, not digital gold. This doesn't mean the thesis is dead—it just means it hasn't been realized yet."
Matt Hougan, Chief Investment Officer of digital asset management firm Bitwise, believes the cryptocurrency market has been in a full-blown winter since January 2025, similar to past bear markets in 2018 and 2022.
He said in a report on Monday: "This is not a 'bull market correction' or a 'short-term pullback.' This is a full-blown, 2022-style crypto winter."
However, Hougan noted that this bear market may be nearing its end. He stated that downtrend cycles typically last about 13 months. If the bear market's starting point is set at January 2025 instead of October 2024, cryptocurrencies could bottom within weeks. He wrote: "As a veteran of multiple crypto winters, I can tell you that the end of those winters felt a lot like now: despair, desperation, and listlessness."
