Bitcoin, the world's leading cryptocurrency, has suffered a sharp decline over the past 24 hours, tumbling as much as 14 percent to trade below $63,000. This marks the lowest level since September 2024 and effectively erases all price gains the token accumulated during Donald Trump's presidency. Once heralded as "digital gold," Bitcoin's slide is now shaking confidence among crypto investors and ripple effects are evident throughout broader financial markets.
The most impactful development driving Bitcoin's plunge is an intensifying sell-off in technology stocks. On Thursday, the Nasdaq Composite dropped 1.59 percent to 22,540.59, hitting lows unseen since November. Mega-cap tech firms, which have been aggressively investing in artificial intelligence (AI), sparked concerns as their hefty capital expenditures raised fears about sustained valuations and profit growth. Amazon, for instance, projected a capital expenditure budget of about $200 billion for 2026, signaling no near-term slowdown in costly AI deployments.
These tech concerns, combined with deteriorating U.S. labor market data, have resulted in heightened risk aversion. The S&P 500 declined 1.23 percent to close at 6,798.40, while the Dow Jones Industrial Average slid 1.20 percent to 48,908.72. Investors' increased preference for safer assets contributed to a two-week high for the U.S. dollar.
Bitcoin, often seen as a speculative asset prone to correlation with tech equities, felt the pressure acutely. The cryptocurrency plummeted nearly 50 percent from its record highs above $126,000 registered last fall, slipping below key thresholds including previous pre-2024 election levels near $64,000. At one point on Thursday, Bitcoin traded around $62,576, its lowest since September 2024. On an intraday basis, Bitcoin shed up to 8 percent in some markets, trading near $65,000 in regions such as South Korea, where related indexes like the Kospi fell nearly 4 percent in sympathy with global tech weakness.
Amid the crypto rout, companies heavily exposed to Bitcoin holdings are experiencing notable setbacks. One such firm, led by prominent Bitcoin advocate Michael Saylor, reported wider-than-expected quarterly losses, reflecting the negative mark-to-market impact of Bitcoin’s decline. Shares of this company fell 1.3 percent in extended trading, exemplifying how digital asset volatility is translating into corporate earnings pressure. Similarly, Gemini, the cryptocurrency exchange founded by the Winklevoss twins, announced plans to cut 25 percent of its workforce and cease operations in the U.K., European Union, and Australia as the Bitcoin slump prolongs.
Analysts at Deutsche Bank identified several key factors exerting sustained downward pressure on Bitcoin. These include the broad risk-off sentiment in equities, especially technology stocks, concerns about aggressive corporate AI capital spending, and disappointing U.S. employment indicators. This constellation of worries is driving investors to reduce exposure to highly speculative assets such as Bitcoin. Precious metals like silver were not spared either, falling sharply and adding to the sell-off environment that intensified Thursday's trading losses.
The compression in Bitcoin’s valuation has also stirred alarm among retail and institutional investors. After reaching peaks above $126,000 last fall, Bitcoin’s price is now closer to half that level and trading near lows not seen in over a year. This steep correction raises questions about the sustainability of previous bullish narratives tied to Bitcoin as a store of value or inflation hedge in the current macro context.
Furthermore, market-wide capital reallocation is evident in currency movements. The U.S. dollar hit a two-week high as it benefited from flight-to-safety flows, while the British pound slumped following the Bank of England’s decision to keep interest rates unchanged. Such currency volatility compounds challenges for international crypto investors operating across multiple fiat currency markets.
In conclusion, Bitcoin’s dramatic drop below $63,000 signals a challenging chapter for crypto markets. While previously buoyed by optimism tied to macroeconomic and regulatory faith, the confluence of worsening tech equity fundamentals, heavy AI investment plans, and soft U.S. labor data are depressing risk appetite. This renewed downward pressure underscores the fragility of Bitcoin’s rally and highlights the increasing sensitivity of crypto to broader financial market trends.
Monitoring the Fallout
The current environment demands close attention as Bitcoin attempts to find its footing amid a turbulent market landscape. Investors and industry observers will be watching for signs that the tech sector’s investment cycle might stabilize or that labor market data might improve, which could potentially revive risk sentiment. Until then, Bitcoin faces near-term headwinds that may continue to weigh on prices and investor confidence.