(Bloomberg) – Cryptocurrencies faced renewed pressure as a selloff in U.S. equities overshadowed President Donald Trump’s recent pro-crypto efforts.
Market Turbulence Hits Bitcoin and Ether
On Tuesday morning in Asia, Bitcoin fell over 3%, while Ether (ETH) dropped as much as 6% to $1,756, hitting its lowest intraday level since October 2023, according to Bloomberg data. Both tokens later pared some of their losses, but market sentiment remains fragile.
The sharp declines in crypto markets coincided with a deepening selloff in U.S. equities, led by technology stocks. The Nasdaq 100 Index plunged 3.8%, marking its worst day since October 2022, as Wall Street reacted negatively to Trump’s warning of potential economic disruptions due to escalating trade tensions with Canada, Mexico, and China.
Crypto Loses Momentum Despite U.S. Bitcoin Reserve Announcement
Despite Trump’s executive order establishing a U.S. Bitcoin reserve, crypto markets have struggled to find traction. According to Joshua Lim, Co-Head of Markets at FalconX Global, now that the industry has secured its strategic Bitcoin reserve, there are “fewer positive forward catalysts” to drive prices higher, leaving digital assets vulnerable to broader macroeconomic risk sentiment.
Trump’s order, issued ahead of a March 7 crypto summit, directed the U.S. Treasury and Commerce Departments to develop “budget-neutral strategies” for acquiring Bitcoin—meaning the government will not directly purchase additional BTC. The lack of immediate capital infusion into the crypto market has dampened investor enthusiasm.
Oversold Conditions and Support Levels
According to Hayden Hughes, Head of Crypto Investments at Evergreen Growth, the market appears to be overreacting to the Bitcoin reserve announcement. “The market now appears deeply oversold,” Hughes said, suggesting that the recent downturn may be exaggerated.
Leveraged Crypto ETFs Take a Beating
Among the hardest-hit assets in Monday’s market-wide selloff were exchange-traded funds (ETFs) offering leveraged exposure to Bitcoin and crypto-linked companies. Two leveraged ETFs tracking Strategy (formerly MicroStrategy) fell more than 30%, underscoring the market’s volatility.
Bitcoin’s Key Support Levels
As of 10:52 a.m. Tuesday in Singapore, Bitcoin was trading around $79,300. Analysts, including Hughes, expect strong buying support around $73,000 and $70,000 if the downturn continues.
While crypto markets remain vulnerable to macroeconomic pressures, some analysts see oversold conditions as an opportunity for accumulation, particularly if Bitcoin stabilizes near key support levels.
