A week-long rout in bitcoin worsened Friday, with the digital asset hitting another three-month low overnight amid fresh trade tensions.
The price of bitcoin was last lower by 1.9% at $81,539.64, according to Coin Metrics. Earlier, it fell as low as $78,226.23.
The blue-chip coin is down more than 14% for the week and on pace for its worst week since November 2022, which was around the time of the FTX collapse. It’s also heading for its worst month since June 2022.
A broader risk-off move this week knocked bitcoin to its lowest levels in three months and put it more than 25% off its all-time high, reached in January on President Donald Trump’s inauguration day. Investors have been shunning assets perceived to be risky given the weakness in global equity markets and amid uncertainty surrounding the new president’s tariff policy and resolutions to the Russia-Ukraine and Israel-Gaza wars.
There could be more of the same in the new month ahead, with bitcoin expected to be at the mercy of investors’ macro concerns despite its strong regulatory tailwinds.
Bitcoin’s declines this week have triggered a wave of long liquidations – about $415 million in the past 24 hours alone, according to CoinGlass. These force traders to sell their assets at market price to settle their debts and help push the asset’s price even lower.
Further, exchange traded funds that track bitcoin are heading for a record week of outflows, which stand at $2.7 billion as of Thursday’s market close.
However, investors have found a silver lining in bitcoin’s relative strength index (RSI), a momentum indicator used to measure overbought or oversold conditions, which fell to 25 on Friday, giving some investors hope that bitcoin could find a bottom in March. A value below 30 usually indicates an asset is oversold.
Investor sentiment this week was also soured by news that Bybit, a major cryptocurrency exchange, suffered a $1.5 billion hack in what’s estimated to be the largest crypto heist in history.
Still, crypto bulls remain positive on bitcoin’s outlook as they await key regulatory developments from the Trump administration. Geoffrey Kendrick, head of digital assets research at Standard Chartered, said he still expect bitcoin to surpass the $200,000 threshold this year despite the current pullback – which several analysts warn could deepen to $70,000.
—CNBC’s Ryan Browne contributed to this report
Correction: This article has been updated to reflect the percentage decline on the day in the price of bitcoin.