Bitcoin edged dangerously close to the key $70,000 level on Thursday as the world’s largest cryptocurrency continued its steep decline, signaling increased caution among investors and fragile market sentiment.
The digital currency fell more than 3% in the Asian session, reaching $70,052.38, its lowest price since November 2024, while Ether dropped nearly 2% to $2,086.11, approaching a critical $2,000 threshold.
Analysts attribute the sell-off to Kevin Warsh’s nomination as the next Federal Reserve Chair, with expectations that he may shrink the Fed’s balance sheet, reducing liquidity that previously supported speculative assets like cryptocurrencies.
Bitcoin has fallen over 7% in the past week, bringing its year-to-date losses to nearly 20%, while Ether has dropped around 30%, reflecting a broader decline across the crypto market since last October.
Institutional investors have been withdrawing massively from cryptocurrency ETFs, with US spot Bitcoin ETFs seeing outflows of more than $3 billion in January alone, following billions in previous months, signaling waning confidence in digital assets.
Market experts warn that this steady selling pressure and ongoing uncertainty may continue to drive Bitcoin and Ether lower, as investors adjust portfolios and sentiment remains cautious amid potential Federal Reserve policy changes.