Bitcoin Drops 25% from Its Peak - Will the Decline Continue?
Bitcoin has plunged 25% from its peak amid market turmoil. With key support levels in focus, is a deeper Bitcoin price drop ahead?
Crypto.King
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Feb 28 2025
The cryptocurrency market is experiencing a sharp downturn, with Bitcoin leading the plunge. Over the past month, Bitcoin has lost more than 20% of its value amid macroeconomic uncertainty, geopolitical tensions, and a record-breaking hack of Bybit. Once a key driver of the crypto rally, former U.S. President Donald Trump now weighs on the market with his tariff policies. Analysts warn of a critical support level around $70,000, but some optimists still see potential for recovery.
Bitcoin has dropped approximately 18% over the last week alone, marking its worst performance in months. This decline brings it more than 25% below its peak from just six weeks ago. Other cryptocurrencies, including Ethereum, Polkadot, and XRP, have suffered even steeper losses in recent days.
The cryptocurrency market is experiencing a sharp downturn, with Bitcoin leading the plunge. Over the past month, Bitcoin has lost more than 20% of its value amid macroeconomic uncertainty, geopolitical tensions, and a record-breaking hack of Bybit. Once a key driver of the crypto rally, former U.S. President Donald Trump now weighs on the market with his tariff policies. Analysts warn of a critical support level around $70,000, but some optimists still see potential for recovery.
Bitcoin has dropped approximately 18% over the last week alone, marking its worst performance in months. This decline brings it more than 25% below its peak from just six weeks ago. Other cryptocurrencies, including Ethereum, Polkadot, and XRP, have suffered even steeper losses in recent days.
Bitcoin Plummets to Its Lowest Level Since November
According to Caroline Bowler, CEO of BTC Markets Pty Ltd, this is the first time since 2022 that such negative sentiment has gripped the market. She compares the current downturn to the infamous "crypto winter" of that year, when rising interest rates and industry challenges drove digital asset prices sharply lower. "The latest drop reflects concerns over Trump’s new tariffs and ongoing geopolitical uncertainty," Bowler said.
"The latest drop reflects concerns over Trump’s new tariffs and ongoing geopolitical uncertainty," Bowler said.
From Crypto Champion to Market Headwind
Bitcoin and the broader crypto market surged in the months leading up to Trump election victory, fueled by his pro-crypto rhetoric and his promise to make the U.S. a global hub for digital assets. However, his recent policy shifts have cast a shadow over that optimism.
Trump’s announcement of a 25% tariff on imports from Mexico and Canada, effective March 4, has signaled a retreat from his earlier promises of trade relief. Additionally, a new 10% tariff on Chinese imports has triggered a strong response from China, which has vowed to retaliate with "all necessary measures."
These developments have weighed heavily on global markets, especially in Asia and Europe. The crypto sector, in particular, has been among the hardest hit, with Bitcoin posting a 20% monthly decline in February. If this trend continues, it could mark Bitcoin’s worst trading month since June 2022.
What’s Next for Bitcoin Investors?
Bitcoin’s steep drop underscores a shift in investor sentiment regarding the so-called "Trump Trade." Initially, traders bet on a crypto-friendly administration, but uncertainty now looms over Trump’s actual policy moves. After soaring to an all-time high of $109,000 in January, Bitcoin’s sharp pullback suggests traders are reassessing their outlook on digital assets under his leadership.
"Given the current macroeconomic environment, it’s not surprising that Bitcoin is where it is," said Stephan von Haenisch, head of trading for Asia-Pacific at BitGo. He noted that investors are waiting for tangible policy changes from Trump, such as the possibility of the U.S. establishing a national Bitcoin reserve.
The sell-off has also impacted Bitcoin ETFs, with U.S.-listed funds seeing over $1 billion in outflows on Tuesday – the worst day for redemptions since their launch last year.
How Low Can Bitcoin Go?
Technical analysts are closely monitoring Bitcoin’s key support levels. Ruslan Linke, head of markets at crypto platform YouHodler, identified $70,000 as a significant support zone. However, he cautioned that if negative sentiment persists in equity markets, Bitcoin could face a deeper decline.
Mark Cudmore, an editor at Bloomberg MLIV, went even further, predicting that "the real panic is still ahead." He suggested that Bitcoin remains vulnerable to another 70% crash, similar to previous cycles. He emphasized that the $72,000–$74,000 range is a critical zone that could determine Bitcoin’s next move.
The Largest Crypto Hack in History
In addition to economic and geopolitical concerns, a massive security breach has further rattled crypto investors. Bybit, one of the world’s largest crypto exchanges, suffered an unprecedented hack that resulted in $1.5 billion in losses – the largest crypto heist in history. This event has intensified fears over asset security, prompting some investors to pull funds from the market.
"The market has become highly volatile in the wake of the Bybit hack," said Jeff Mei, COO of BTSE. He added that lingering inflation concerns and uncertainty over Federal Reserve rate cuts are also weighing on digital assets.
"The market has become highly volatile in the wake of the Bybit hack," said Jeff Mei, COO of BTSE
Is There Hope for a Bitcoin Rebound?
Despite the downturn, some industry experts remain optimistic. Geoffrey Kendrick, head of digital asset research at Standard Chartered, believes Bitcoin could still rally to $200,000 this year and potentially reach $500,000 by the end of Trump’s term. "Institutional adoption and regulatory progress in the U.S. will help reduce volatility over time," he stated.
Similarly, crypto influencer Michaël van de Poppe argues that the current drop is merely a "liquidity hunt" before the next surge. He suggests Bitcoin needed to dip below $90,000 to trigger large buy orders clustered around these levels. According to him, the real bottom is likely between $83,000 and $87,000, after which Bitcoin could stage a strong recovery.
Conclusion: Uncertainty Looms, But Opportunity Remains
Bitcoin’s recent 25% decline underscores the volatile nature of the crypto market. With macroeconomic concerns, shifting U.S. policies, and security breaches shaking investor confidence, the road ahead remains uncertain.
However, history has shown that Bitcoin is resilient, and for long-term believers, this correction could present a compelling buying opportunity. The next few weeks will be critical in determining whether Bitcoin finds support and rebounds – or if the worst is yet to come.
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Please note that the article should not be considered as investment advice or marketing, and it does not take into account the personal data and requirements of any individual. It is not a substitute for the reader's own judgment, and it should not be considered as advice or recommendation for buying or selling any securities or financial products.
