Bitcoin crumbled below $80,000 on Monday, sinking to $77,396, its lowest price since November 2023. The drop followed a 3.8% 24-hour decline, erasing gains from a brief rally to $84,000 earlier in the day.
Ethereum briefly dipped under $1,800, down more than 10%, as panic spread across crypto markets. Analysts linked the plunge to fading investor confidence amid macroeconomic uncertainty and equity market turmoil.
Stock Market Carnage Amplifies Crypto Pain
The Nasdaq and S&P 500 nosedived early Monday, dragging risk assets like cryptocurrencies lower. Tech-heavy Nasdaq slid 3%, while the S&P 500 fell 2%, reflecting fears of a U.S. recession.
President Trump’s refusal to rule out an economic downturn during a Fox News interview intensified anxiety. “Until crypto finds a new narrative, expect tighter correlation with stocks,” warned hedge fund QCP in a note. Consequently, crypto’s dependency on broader market trends left little room for recovery.
Altcoins Suffer Double-Digit Losses in Broad Market Sell off
Solana (SOL), Cardano (ADA), and Avalanche (AVAX) plummeted 7%-10% within 24 hours, mirroring Bitcoin’s decline. The CoinDesk 20 Index, tracking major tokens, fell 5% as selling pressure intensified. Similarly, Aptos (APT) and NEAR joined the bloodbath, shedding 9% each. This widespread downturn marked crypto’s weakest start to a week in 2024, with traders fleeing high-risk assets.
Crypto Tank as Investor Sentiment Sours
Publicly traded crypto firms faced steep losses. MicroStrategy (MSTR), holding over 499,096 in Bitcoin, plummeted 16%, while Coinbase (COIN) shares crashed 17.6%.
Retail platform Robinhood (HOOD) sank 19.8%, reflecting eroding trust in crypto-linked stocks. Furthermore, Bitcoin ETFs recorded $867 million in outflows last week, their fourth straight week of withdrawals. Experts noted that fading institutional interest exacerbated the sell-off.
Macroeconomic Storm Clouds Darken
Crypto markets currently lack positive catalysts, with Trump’s Bitcoin reserve executive order failing to inspire bulls. Instead, fears of a tariff war and slowing growth dominated sentiment.
“The economy is in a transition phase,” Trump stated ambiguously, avoiding clarity on recession risks. Moreover, looming U.S. economic data, including CPI and JOLTS reports threaten more volatility. Analysts warn that without crypto-specific triggers, macro headwinds will keep prices suppressed.
Investors Brace for More Pain Before Potential Rebound
Despite the bleak outlook, long-term optimism persists. Regulatory progress and ETF approvals earlier this year gives hopes for a 2024 recovery. However, traders anticipate further drops before Bitcoin challenges record highs. “Volatility could spike ahead of macro data,” QCP added, signalling tense days ahead. For now, crypto’s fate remains tied to equities and economic indicators, leaving little room for independent momentum.
Key Details:
- Bitcoin low: $77,396.43 (Nov 2023 levels)
- Equity drops: Nasdaq -3%, S&P 500 -2%
- Crypto equity losses: MSTR -16%, COIN -17.6%, HOOD -19.8%
- ETF outflows: $867M last week; $4.75B over 4 weeks
- Critical data ahead: JOLTS (Tue), CPI (Wed), PPI (Thu)
Written By Fazal Ul Vahab C H
