Bitcoin (BTC) erased all of its early 2025 gains on Wednesday as macro jitters and the global bond rout accelerated the selloff in crypto prices.
The biggest crypto slipped to a session low of $92,600 during US trading hours, losing nearly 10% in two days from its peak on Monday above $102,000. It has recovered some of the losses and recently traded at $94,300, still down 2.5% over the last 24 hours.
ADA Cardano, RNDR Render and APT Aptos led losses in the broad market benchmark CoinDesk 20 indexwhich slipped over 3% over the same period.
The violent two-day plunge wiped out nearly $1 billion worth of leveraged derivatives positions across crypto assets, mostly longing to bet on higher prices, CoinGlass data shows. The slide also temporarily pushed BTC below where it started the year. At the recent price, it was up 1% from its January 1 open.
Crypto related stocks were not spared. Several bitcoin miners, including TeraWulf (WULF), Bit Digital (BTBT), Bitdeer (BTDR), IREN (IREN) and Hut 8 (HUT) suffered declines of 5%-8%. Medical device producer Semler Scientific, which adopted a BTC treasury strategy following in the footsteps of MicroStrategy (MSTR), was down nearly 10% on the day and is now down more than 15% for the week and about 40% from to peak at the end of December. MSTR was down 2.2% on Wednesday.
Various analysts warn crypto traders from a risky January, with possible macro upsides for risk assets ahead, including a hawkish Federal Reserve, a rapid rise in long-term government bond yields, sticky inflation readings and the possibility of a US government shutdown. What appeared to be driving the rebound across all assets was Tuesday's strong US economic data prints that had investors downgrading their expectations of rate cuts for the year.
Notably, Fed governor Christopher J. Waller it came out on Wednesday to support further interest rate cuts during the year and calm inflationary fears from potential tariffs enacted by incoming President Donald Trump. However, that did little to change investors' interest rate outlook, as the CME FedWatch he showed
Minutes from the Fed's latest policy meeting were released on Wednesday afternoon US time he showed most believed that the risks to inflation had increased and also showed some concern that Trump's tariff policy could have a greater impact on price levels than previously thought.
With Wednesday's drop, bitcoin returned to the lower end of its range it has been trading in since late November. BTC is likely to see a rebound from the lows in the coming days, but prices could remain consolidating the range and possibly pull back to lower levels before setting new all-time highs, according to the cross-trader assets of Bob Loukas, founder of Station3. NYC.