Bitcoin has officially entered a technical bear market after plunging 20 percent from its all-time high of $108000 hit earlier this month. The cryptocurrency dipped below $86000 Tuesday morning a stark fall from the euphoria tied to President Trump’s pro-crypto stance. Investors who rode the wave of his election win are now facing a harsh reality as market forces take hold. Other digital coins like Ethereum followed suit signaling a broader retreat in the volatile asset class.
The slide began late Monday with Bitcoin shedding 5 percent in hours before sinking further. Traders point to profit-taking after a blistering rally that saw the coin top $100000 post-Trump’s November victory. His vows to make America a crypto powerhouse fueled the surge with hopes of lax rules and a national stockpile. Yet Tuesday’s drop to $86000 erased $50 billion in market value across crypto per industry data. Analysts say this correction was overdue after such a steep climb.
Trump’s influence on Bitcoin remains a hot topic amid the downturn. He’s tapped crypto-friendly advisors like Elon Musk pushing tax breaks and lighter SEC oversight. That rhetoric lifted spirits with bulls betting on a $150000 peak by year-end. But Tuesday’s bear turn shows macro pressures can override policy hype. Rising U.S. Treasury yields and a stronger dollar pulled cash from risk assets like Bitcoin. Global moves like China’s mining crackdown added to the gloom.
Technical charts tell a grim story for Bitcoin holders. The coin breached its 50-day moving average a key support level triggering sell-offs. Ethereum dipped 4 percent to $3200 while altcoins like Binance Coin fell harder. Some traders call it a healthy purge of excess after months of gains. Others warn it could test $80000 soon if panic sets in. The 20 percent drop from $108000 fits the bear market definition shaking out weaker hands.
Investors now weigh Trump’s next moves against this backdrop. His administration is juggling trade wars and cuts via Musk’s Department of Government Efficiency. Crypto fans hope he’ll double down on promises to shield digital assets. Yet Tuesday’s rout suggests his words alone can’t buoy prices forever. Posts on X frame it as a dip to buy with Bitcoin still up 300 percent since 2020. Skeptics counter it’s a bubble deflating as rates rise.
The broader economy feels the ripple effects of Bitcoin’s woes. Retail investors who piled in near the peak face paper losses denting confidence. Crypto firms like Coinbase saw shares slip 3 percent Tuesday as trading slowed. Trump’s pro-business tilt may cushion some blows with tax perks in play. But if the bear market deepens it could chill the speculative fever that drove 2025’s early gains.
Historical patterns offer mixed clues for Bitcoin’s path. Past bear markets in 2018 and 2022 saw drops over 50 percent before recoveries. This time Trump’s backing adds a wild card though not enough to stop Tuesday’s slide. Miners report higher costs as China’s clampdown bites cutting supply growth. Demand may rebound if Trump delivers on deregulation yet for now sellers rule. The $86000 floor is the line to watch.
Bitcoin’s fate hinges on whether bulls or bears seize control. Trump’s team could push policies to spark a bounce like easing capital gains rules. Yet global headwinds and profit cash-outs may keep it pinned. Tuesday’s 20 percent plunge from $108000 marks a sobering shift from the rally’s peak. Investors brace for more swings as the crypto king navigates uncharted waters under a president who’s all in on its rise.
Coverage Details
| Total News Sources | 21 |
| Left | 7 |
| Right | 6 |
| Center | 5 |
| Unrated | 3 |
| Bias Distribution | 33% Left |
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