Bitcoin prices reached a fresh, 2025 low today.
Bitcoin prices fell sharply on Wednesday, February 26, breaking through the $85,000 level and approaching $82,000 as the political momentum that helped fuel recent gains seemingly started to run out of gas.
The world’s most prominent cryptocurrency declined to as little as $82,111.12 around 3 p.m. EST, according to Coinbase data from TradingView.
At this point, the digital currency had dropped close to 25% from its all-time high of over $108,000 and was trading at its lowest point of this year, additional Coinbase figures from TradingView show.
In the last few months, the digital currency attained fresh, all-time highs on anticipation surrounding the policy changes that could materialize as a result of U.S. President Donald Trump securing reelection and the Republicans taking control of both the House and Senate.
The Republican party had made cryptocurrency part of its platform, and this development ignited substantial optimism in the crypto/blockchain community that the party’s victory would help create regulatory clarity surrounding digital assets.
Tim Enneking, managing partner of Psalion, spoke to these developments, stating via email that “The dramatic rise in BTC prices since the US federal election has not been followed up by any concrete action – only many statements of intent in both the US at the federal and state levels, and in several other countries.”
“At the same time, chaos reigns in the US government because of the actions being taken by Trump with respect to tariffs, by Elon Musk at the head of DOGE, and by Republicans in Congress with respect to the budget and federal deficit,” he added.
“Risk-on assets – especially crypto – have fallen out of favor across the board,” Enneking emphasized.
The S&P 500, Dow Jones Industrial Average and Nasdaq Composite have all lost value since earlier this month, according to figures provided by Google Finance.
The TikTok influencer who goes by Wendy O also highlighted the key role played by the U.S. federal government, claiming through emailed input that bitcoin’s recent weakness “can be attributed fundamentally to Trump announcing that Tariffs are back on for both Mexico and Canada that will take place next week.”
Additional Bearish Factors
Multiple analysts took a broader approach, citing a range of variables as being behind bitcoin’s recent depreciation.
“Bitcoin’s recent drop to about $85,000 is linked to several factors that are making investors nervous,” Mike Marshall, head of research at Amberdata, stated via emailed comments.
“Large funds are pulling out of Bitcoin ETFs, and many investors are avoiding tech stocks right now. Because Bitcoin often moves in line with tech stocks, when markets like the Nasdaq fall—and companies like Tesla and Nvidia face challenges—Bitcoin also suffers,” he noted.
“Additionally, signs from the U.S. economy are not very encouraging,” Marshall added. “New home sales have fallen far more than expected, and high 10-year Treasury yields point to concerns about the economic future.”
“Economic damage from tariff regimes also adds to a weak outlook,” he stated. “Consumer confidence and business activity are down, and rising inflation worries add to the uncertainty. Not to mention geo-political uncertainty.”
Brett Sifling, wealth manager for Gerber Kawasaki Wealth & Investment Management, also pointed out to several bearish developments as fueling bitcoin’s recent downside.
“I think there are quite a few reasons why Bitcoin had it’s latest decline, rather than one specific reason. Starting with the general pullback in the risk-on equities market, it seems that Bitcoin’s still very correlated with the recent -5% correction in the Nasdaq,” he stated via emailed commentary.
“There have also been massive outflows with the Bitcoin spot ETFs, which have seen nearly a billion dollars in outflows in just one day this week. There has been speculation that these spot ETF outflows are primarily driven by the popular futures/spot Bitcoin carry trade has declined in it’s profitability,” Sifling added.
“Lastly, the public was also reminded about the high-risks of holding cryptocurrencies on exchanges with the recent Bybit hack, which was the largest money heist in the history of crypto,” he noted.
“While it wasn’t directly hacked of it’s Bitcoin, it’s doesn’t build confidence for market participants if we continue to see massive fraud and theft across the industry while regulators struggle to keep up with the high pace of innovation that’s happening in front of them.”
Disclosure: I own some bitcoin, bitcoin cash, litecoin, ether, EOS and SOL.
