Bitcoin fell below $80,000 on Friday, extending its sharp decline in February as investor sentiment soured.
The cryptocurrency dropped 7.3% to $78,547.88, putting it on track for a loss of over 20% for the month. Those who bought in at $108,000 high and in euphoria of Trump's election win; well, they're currently nursing a 27% loss.
The initial surge came on hopes of pro-crypto policies, but recent concerns over US tariffs and the Federal Reserve’s hawkish stance have triggered a six-week sell-off. Trump reaffirmed plans for 25% tariffs on Mexican and Canadian imports and a 10% levy on Chinese goods, stoking fears of trade tensions and pushing investors away from riskier assets like Bitcoin.
Markets are also bracing for US inflation data, with the PCE index expected to show persistent price pressures. This could influence the Fed’s interest rate decisions, prompting Bitcoin holders to cut positions in anticipation of a stronger US dollar.
Altcoins followed Bitcoin lower, with Ethereum dropping 10.6%, XRP losing 10%, and Solana down 9.2%.