Bitcoin was on the verge of falling below the $70,000 mark on Thursday, as the decline in the world’s largest cryptocurrency showed little sign of easing. During the Asian trading session, Bitcoin fell over 3 percent to $70,052.38, its lowest price since November 2024.
Meanwhile, Ether, the second-largest cryptocurrency, also slipped, dropping nearly 2 percent to $2,086.11. A fall below $2,000 would be its first since May of last year.
As of 7:09 GMT, Bitcoin was trading 2.79 percent lower at $70,996, while Ether was down 6.74 percent to $2,111.67.
Smaller Fed balance sheet to impact crypto market
The recent sharp decline in cryptocurrencies has been swift, with analysts pointing to Kevin Warsh’s nomination as the next Federal Reserve Chair as a key trigger, amid expectations that he may reduce the Fed’s balance sheet.
Bitcoin has dropped over 7 percent this week, bringing its year-to-date losses close to 20 percent, while Ether has fallen nearly 30 percent so far this year.
Cryptocurrencies have generally benefited from a large Fed balance sheet, often rallying when the central bank injected liquidity into money markets, providing support for speculative assets.
Cryptocurrencies have faced persistent weakness since last October’s record crash, which sent Bitcoin tumbling as leveraged positions were liquidated. Investor interest in digital assets has cooled, leaving market sentiment fragile.
The broader downturn has been largely fueled by significant outflows from institutional ETFs, which have seen billions of dollars withdrawn each month since the October 2025 slump. U.S. spot Bitcoin ETFs experienced over $3 billion in outflows in January, following withdrawals of around $2 billion in December and $7 billion in November.
Read: Bitcoin rebounds from near 10-month low to over $78,000
Sell-off in global tech stocks spills over
A renewed sell-off in global tech stocks also spilled over into cryptocurrency markets on Thursday, dampening hopes of a sustained rebound after last week’s volatility. The declines followed sharp drops in Asian equities, driven by concerns over AI spending, high valuations, and slowing earnings growth, which pushed investors away from riskier assets.
U.S. markets also saw weakness, with the Nasdaq falling as disappointing earnings from companies like Alphabet, Qualcomm, and Arm stoked fears that AI investment may have peaked sooner than expected.
Bitcoin has increasingly behaved like a high-beta risk asset during equity-led sell-offs, particularly amid thin liquidity and rising macro uncertainty. The pressure was further amplified by sharp commodity moves, with silver plunging up to 17 percent and gold falling over 3 percent, fueling liquidations of tokenized metals products on crypto trading platforms.
