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Bitcoin dropped on Wednesday to its lowest level since October 2024 amid a pullback in tech stocks, as the crypto bear market drags on.
The price of bitcoin slid more than 4% to $59,548.19. Earlier, it hit a low of $59,023.98, its lowest level since Oct. 10, 2024.
This is the third time this year that bitcoin has traded below $60,000.
The flagship cryptocurrency, in roughly its eighth month of a bear market, is being squeezed from both macroeconomic and industry-specific headwinds. Capital has been rotating into AI stocks, hot IPOs and prediction markets. Meanwhile, inflationary pressures stemming from the Iran war have kept the Federal Reserve focused on combating inflation, creating a challenging backdrop for bitcoin. And a broader loss of confidence across the crypto market has led investors to question bitcoin’s unique value proposition.
The primary upside catalyst for the broader crypto industry, the market structure bill known as the CLARITY Act, has about five weeks to clear a key legislative hurdle before Congress’ summer recess. If it misses that window, the bill will likely be pushed to the fall.
Although sentiment is weak, bitcoin’s decline has been more muted than the crushing drawdowns that characterized previous crypto winters. One big reason for that is the increase in institutional participation, according to Sam Callahan, director of bitcoin strategy and research at bitcoin treasury firm OranjeBTC.
“People say this was the worst bull market and the best bear market,” said Sam Callahan, director of bitcoin strategy and research at bitcoin treasury firm OranjeBTC. “What that’s really saying is that bitcoin’s not as volatile as it was in previous bear markets because of the investor base: it’s larger, it’s more liquid, it’s not so much a smaller retail-held asset. It’s more institutionalized now, and so you’re going to see declining volatility both on the upside and the downside.”
Bitcoin ETFs collectively have seen $182 million exit the funds so far this week and are on pace for their seventh consecutive week of net outflows. Total assets held in bitcoin ETFs have fallen to $77.5 billion from about $113 billion at the end of last year.
—CNBC’s Nick Wells and Gina Francolla contributed reporting.
