Shock and fear dominate Bitcoin (BTC) investors. On Thursday 5/2, the price of the world’s largest cryptocurrency plunged below 70.000 dollars for the first time since November 2024, erasing all the gains recorded since the election of Donald Trump to a second term as President of the United States.
At the time of writing, Bitcoin was down 12% at 65.000 dollars, as digital tokens were dragged lower by a broad sell off in technology stocks.
This year, Bitcoin has lost more than one fifth of its value in dollar terms.
“Sentiment has deteriorated dramatically,” says Jasper De Maere, strategic analyst at trading firm Wintermute. “The crypto market still looks tired, as there is no one willing to step in at these levels.”
Ether, the second largest cryptocurrency, fell 8% to 1.960 dollars, bringing its losses this year to 34%.
Bitcoin had surged after Trump’s election victory, boosted by his pledge to make the United States “the global capital of cryptos” and to reduce regulatory oversight in the cryptocurrency space.
Since taking office last year, the Trump administration pushed through industry friendly legislation, while regulators suspended many enforcement actions, driving Bitcoin to a record high above 125.000 dollars in the summer.
However, this frenzy gradually faded as investors turned to precious metals as long term stores of value, triggering historic rallies in gold and silver.
In addition, key legislation related to cryptocurrencies in the United States has effectively been frozen this year.
The sell off intensified this week as the decline in technology stocks was triggered by investor concerns over the impact of artificial intelligence on tech companies.
Shares of Strategy, the company that holds large quantities of Bitcoin under Michael Saylor, fell 12% on Thursday, extending losses to more than 25% this year and leaving the company with billions of dollars in unrealized losses.
Saylor had purchased 713.502 Bitcoin at an average price of 76.052 $, through equity and debt issuance. On X, he posted “HODL” amid the downward price spiral, using the well known crypto term meaning “hold.” The company is expected to announce its results on Thursday after market close.
Meanwhile, crypto exchange Gemini, co founded by twins Tyler Winklevoss and Cameron Winklevoss, announced it will lay off 200 employees and scale back parts of its operations to cut costs. Its shares have fallen 80% since their stock market debut in September 2025.
On the prediction platform Kalshi, traders began last month to bet on how low Bitcoin’s price could fall this year, with the probability of dropping below 60.000 $ reaching around 85%. The cryptocurrency market appears trapped in a downward vortex, with investors helplessly watching the value of their digital assets evaporate before their eyes.
Technical levels
Since 21 January, Bitcoin has lost approximately 20.000 $, reaching the 70.000 $ level.
BTC is as oversold as it has been since August 2023.
Momentum is ugly and the temptation to try to catch a few falling knives is beginning to emerge.
BTC broke below its 100 day moving average after losing support at 90.000 $.
The 200 week moving average stands around 60.000 $.
But it is better to ignore the narrative, BTC is not a “fear hedge.” It is the opposite.
Technology volatility (VXN) spiked and BTC did exactly what it always does. You can decide whether BTC is the “end game hedge.”
The market has already decided something else. The last surge in the long term Japanese segment marked the top for BTC. Since then, the move has been one way only.
Call it money, call it code, call it philosophy. BTC still behaves like software.
And as software fell out of favor, BTC moved accordingly.
Institutions are selling Bitcoin
“Think about the similarities between SaaS and software stocks trapped in the current collapse and Bitcoin, where there is a digital effect, an inherent scarcity angle with firewall costs to interact with a proprietary effect or API, computing power and electricity to unlock value, and seat based subscription to access that value or the ledger. It kind of makes sense, right?” notes Nomura.
“Ultimately, the reduction of institutional exposure to Bitcoin caused a lack of liquidity in the market, which made the price of BTC fall even more sharply,” it adds.
Jefferies perfectly described the latest BTC collapse, highlighting the risk posed by quantum computers.
“The quantum risk is no longer theoretical.”
There is growing concern that cryptographically relevant quantum computers (CRQCs) could emerge in a few years rather than decades, threatening Bitcoin’s security model and its narrative as “digital gold.”
Up to 20–50% of BTC could be vulnerable, with estimates indicating 4–10 million BTC exposed due to address reuse, while exchange and institutional wallets are more exposed if quantum attacks become realistic.
Bitcoin faces a governance dilemma, as the community debates whether vulnerable coins should be burned to preserve system integrity or whether nothing should be done, risking theft, a choice that pits protocol security against property rights.
Preemptive action could reduce supply.
If vulnerable coins are burned, the available Bitcoin supply would shrink, potentially supporting prices in theory, but only after an extremely controversial and unprecedented fork type decision. (Jefferies Greed and Fear)
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