Bitcoin worth slumps to lowest stage since Trump gained election as crypto fears develop
Experts have said that a combination of investors withdrawing from speculative assets, worry over Washington’s future cryptocurrency regulation and Trump’s nomination of Kevin Warsh for Fed chair have rattled the bitcoin price
A statue of President Donald Trump holding a bitcoin in recognition of his support for cryptocurrency (file image)(Image: AP)
Prices of the original digital currency Bitcoin have fallen further this week, slipping to its lowest level since Donald Trump was re-elected President of the United States.
The cryptocurrency fell a further 11% on Thursday, February 5 to $67,000, worth less than it was Trump re-elected in November 2024, the Associated Press reported.
Bitcoin has lost nearly half of its value since October 6, when it hit a record high of $126,210.50, according to crypto trading platform Coinbase. The currency, pitched as “digital gold,” was trading at $66,301 as of 2pm US eastern time.
“This steady selling in our view signals that traditional investors are losing interest, and overall pessimism about crypto is growing,” said Deutsche Bank analyst Marion Laboure on Wednesday.
Prices for the cryptocurrency have gained for the better part of a year after Trump won the vote, in part a result of improved investors expectations of a more crypto-friendly administration. These gains have now been erased.
The sell-off appears to be a perfect storm of investors withdrawing from speculative assets like gold, silver and digital currencies, and worry over Washington’s future cryptocurrency regulation, the AP reported. Trump has heavily backed cryptocurrency companies since his election.
Experts have also said that Trump’s nomination of Kevin Warsh for chair of the Federal Reserve also played a part in Bitcoin’s fall.
The White House hosted banks and cryptocurrency companies at an event this week to determine whether an agreement could be made on pending legislation to regulate stablecoins.
The AP reported that the cryptocurrency industry wants to be able to pay customers for holding their deposits in crypto or stablecoins, while banks believe cryptocurrency accounts providing a dividend or yield would reduce money in the traditional banking system.
The AP reported that it appears the bill is not going to move forward in Congress.
American Bitcoin, in which the US president’s sons Eric Trump and Donald Trump Jr. hold a stake, is down more than 80% since Oct. 7.
Other Trump-related crypto ventures have also fallen.
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