Bitcoin slid below $70,000 for the first time since November, extending a sharp selloff driven by forced liquidations, fading risk appetite and mounting redemptions from crypto-linked investment products, Bloomberg reports.

The decline has erased all of the gains sparked by the speculative surge that followed President Donald Trump’s election, marking a dramatic reversal from the token’s rapid ascent late last year.

The world’s largest cryptocurrency fell as much as 8.6% on Thursday to roughly $66,400 before stabilizing near $67,000 in New York trading. The retreat has now wiped out nearly half of Bitcoin’s value since its record high four months ago, with losses spreading across digital tokens, spot Bitcoin ETFs and publicly traded firms holding large crypto reserves.

In addition, the TRUMP coin is trading at $3.66, down 80% over the past year and 31% in the past month.

The downturn marks an abrupt reversal from Bitcoin’s explosive rally through much of last year, when Trump’s return to the White House — viewed by many investors as favorable to the crypto industry — sent money rushing into digital assets and the Wall Street vehicles built around them.

Market stress began building earlier this month as rising geopolitical tensions rippled through global financial markets, dampening risk appetite and triggering a wave of selling.

That shift highlighted Bitcoin’s vulnerability to leveraged speculation.

The decline from mid-January set off a self-reinforcing cycle as funds liquidated positions to meet redemptions and traders rushed to unwind borrowed bets, accelerating losses across the market.

“The fear and uncertainty across the market is evident,” said Chris Newhouse, head of business development at Ergonia. “Without conviction-based buyers willing to lean into the selling, each wave of ETF redemptions and liquidation cascades. That’s amplifying the magnitude of each leg lower and reinforcing the defensive positioning that’s keeping organic demand on the sidelines.”

Ilan Solot, senior global markets strategist at Marex, said the selloff has been fueled by multiple forces, including weakness in technology stocks, gold’s recent outperformance, a broader shift toward risk aversion and lingering questions about how cryptocurrencies should be valued.

“The outlook is probably still bearish for now, but the worst might be behind us,” Solot said. “Still, these types of moves have historically always been buying opportunities for multi-year investors and many will see it that way.”

The slump has drawn comparisons to the 2022 crypto crash, when prices retreated sharply as the Federal Reserve tightened monetary policy after the easy-money era of the pandemic.

The latest decline is already taking a toll on industry intermediaries. Shares of Coinbase Global are down more than 30% this year, while Gemini said it plans to cut up to 25% of its workforce and wind down operations in the UK, European Union and Australia.

This time, digital assets are also facing competition from other speculative outlets, including legalized sports gambling, prediction markets tied to politics and entertainment, and the growing popularity of short-dated options trading in equities.

Retail traders have increasingly chased higher-yield crypto strategies on decentralized exchanges, diverting flows away from major tokens.

At the same time, doubts persist about cryptocurrencies’ real-world utility.

Once promoted as an inflation hedge or an alternative to gold or the US dollar, Bitcoin has continued to trade more like a high-risk asset and has failed to provide shelter during periods of market stress.

Its expanding presence in institutional portfolios has, at times, made it more vulnerable to broad de-risking — particularly amid recent volatility in technology stocks and precious metals.

“Despite prayers to the other side, crypto-market sentiment continues to hit new lows as the space is in a crisis of narrative,” said Augustine Fan, partner at Hong Kong-based crypto options platform SignalPlus.

U.S. spot-Bitcoin ETFs had provided critical support earlier in 2025, drawing tens of billions of dollars and helping stabilize prices.

That support has faded as the selloff deepened. Roughly $2 billion has flowed out of Bitcoin ETFs over the past month alone, with more than $5 billion withdrawn over the past three months, according to Bloomberg data.

The meltdown in the world’s largest cryptocurrency has rippled across the broader digital-asset market, with smaller and less liquid tokens suffering even steeper losses.

The MarketVector Digital Assets 100 Small-Cap Index, which tracks the smallest 50 assets in a 100-token basket, has plunged about 70% over the past year.

Traders have also grown increasingly defensive in the options market, piling into downside protection around $70,000.

Contracts expiring in late June signal a more bearish outlook, with the largest concentration of open interest clustered near $60,000 and $20,000, according to Deribit.