Several factors have contributed to this downturn. Notably, investor disappointment followed President Donald Trump’s announcement of a Bitcoin reserve composed of cryptocurrencies obtained through criminal and civil forfeitures, rather than active government purchases, leading to negative market sentiment.
Additionally, escalating trade tensions and economic slowdown fears have prompted a shift away from risky assets, further impacting Bitcoin’s value.
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Market correction or bear phase?
Ryan Lee, Chief Analyst at Bitget Research, said Bitcoin’s decline is part of a “broader consolidation phase rather than a definitive shift into a bear market.” He added, “Price corrections after all-time highs are natural, especially given macroeconomic uncertainties and market liquidity shifts. Key support levels between $70,000 and $75,000 will be critical in determining Bitcoin’s near-term trajectory.”Lee noted that the upcoming FOMC meeting and broader risk sentiment will play a crucial role in shaping Bitcoin’s market momentum. “While a hawkish stance could exert short-term pressure, long-term fundamentals remain intact, supported by institutional adoption and ETF inflows.”
Historical patterns and long-term outlook
Anish Jain, Founder & CEO of W Chain, said that Bitcoin’s 30% decline is a natural market correction, not a bear phase. “Historically, such corrections have preceded significant rallies. As the global economy evolves, Bitcoin’s resilience and adaptability will continue to attract investors seeking secure, decentralized assets.”Shivam Thakral, CEO of BuyUcoin, echoed a similar sentiment. “Despite a 30% drop, Bitcoin remains resilient. This isn’t a bear phase but rather a consolidation phase, allowing the market to recharge for future rallies. Now is the time to stay informed, diversify, and consider strategic investments.”Also Read: Pi Coin tumbles 55% from peak as crypto market faces broad sell-off
What should investors do now?
Himanshu Maradiya, Founder & Chairman of CIFDAQ, pointed to Bitcoin’s history of sharp corrections and subsequent rebounds. “In 2021, Bitcoin tanked over 50% from $64,849 to $30,000 before climbing to $69,000. Similar corrections in 2017 led to a massive rally. This dip resulted from profit-taking after Trump oath-day hype and tariff noise looks like a reset in our 2024 halving cycle.”
He suggested that investors consider buying near $74,000 support or use a dollar-cost averaging strategy. “Bitcoin thrives in turbulence, and history favors the patient.”
Also Read: Trump’s Strategic Bitcoin Reserve plan: What’s next for crypto? Here’s what experts think
(Disclaimer: Recommendations, views, and opinions expressed by experts are their own and do not reflect the views of The Economic Times)