Aniket PujariCryptocurrencies slid as fears over a selloff in US equities eclipsed President Donald Trump’s recent efforts to buttress the industry.
Bitcoin fell more than 3% on Tuesday morning in Asia while second-ranked token Ether dropped as much as 6% to $1,756, an intra-day low not seen since October 2023, according to data compiled by Bloomberg. Both tokens later pared those losses.
The initial declines came after a selloff in US equities led by technology stocks picked up steam. The tech-heavy Nasdaq 100 Index plunged 3.8% for its worst day since October 2022. Wall Street is jittery after Trump warned that Americans may feel a “little disturbance” stemming from trade wars with Canada, Mexico and China. Strategists and economists across Wall Street have been raising their odds for a US economic downturn.
“Now that the industry has its strategic Bitcoin reserve executive order, crypto has one fewer positive forward catalyst to price in, and we’re left at the mercy of macro risk appetites,” FalconX Global Co-Head of Markets Joshua Lim said.
Trump ordered the creation of a US Bitcoin reserve and a separate stockpile of other tokens ahead of a high-profile crypto summit with industry executives in Washington on March 7 — much-touted moves that ultimately did little to lift market sentiment. The order authorized the Treasury and Commerce departments to develop “budget-neutral strategies” for buying more Bitcoin, meaning the government will not acquire additional crypto for the stockpile.
Hayden Hughes, head of crypto investments at family office Evergreen Growth, said “the market now appears to be negatively reacting” to the reserve announcement. “But in my estimation this is really an exaggeration and the market is now appearing deeply oversold,” he added.
Among the biggest losers in Monday’s market-wide selloff were exchange-traded funds that seek to offer juiced-up returns on digital assets or crypto-linked themes. Two ETFs used to make leveraged bets on Strategy — the Bitcoin-holding company formerly known as MicroStrategy — fell more than 30% for the day.
Bitcoin was trading at $79,300 as of 10:52 a.m. on Tuesday in Singapore. The largest digital asset is expected to find support at $73,000 and $70,000, according to Hughes. “There will be strong buying there,” he said.
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