Highlights
- Bitcoin plunges to $77,000, erasing entire rally since Trump's inauguration.
- Cryptocurrency falls since president took office despite pro-crypto policies.
- Gold surges to record $5,600 while Bitcoin struggles, undermining 'digital gold' narrative.
The world's largest cryptocurrency tumbled to approximately $77,000 (£56,000) over the weekend as investors abandoned the volatile asset.
The decline marks Bitcoin's weakest position since April last year, when Trump's sweeping tariffs rattled global markets on his self-proclaimed "liberation day".
The dramatic reversal follows Bitcoin's spectacular rise to nearly $125,000 late last year, driven by Trump's pro-crypto measures including regulatory reforms, landmark stablecoin legislation, and the termination of Biden-era lawsuits against major exchanges like Coinbase and Binance.
The president had vowed to transform America into the "crypto capital of the world".
However, Bitcoin has plummeted since Trump's January inauguration and declined 12 per cent year-to-date.
The cryptocurrency has proved vulnerable to the president's tariff threats, geopolitical tensions involving Iran, and his controversial statements regarding Greenland.
The latest drop followed Trump's appointment of Kevin Warsh as Federal Reserve chairman, which strengthened the dollar and calmed fears about central bank independence.
Joe Mazzola at Charles Schwab told The Telegraph "Bitcoin enthusiasts have recently lamented how the cryptocurrency has languished while gold has seemingly ripped ever higher in recent months, punching a big hole in the 'digital gold' narrative."
Gold has surged to record highs exceeding $5,600 this week, highlighting investors' preference for traditional safe havens.
Roberto Rossignoli at Moneyfarm observed that despite Bitcoin's scarcity claims, "global capital, facing uncertainty, overwhelmingly opted for the proven liquidity, deep market history, and universal acceptance of physical precious metals."
The sell-off erased over $100bn from the crypto market's total value, with Ethereum and Solana also suffering sharp declines, reigniting fears of another prolonged "crypto winter".
