- Bitcoin is down significantly over the past week.
- Investors cashed out of US exchange-traded funds, pushing the asset’s price down.
- Geopolitical headwinds have rocked all markets in January.
Bitcoin’s price is down nearly 7% over the past week after US investors cashed more than $1.3 billion out of exchange-traded funds giving exposure to the leading digital coin.
The price of Bitcoin recently stood at $89,225, according to CoinGecko, a drop of 1% over a 24-hour period. Investors cashed out every single day this week from US funds, according to Farside Investors data.
Bitcoin traded higher last weekend — briefly touching $95,419 — before dropping hard on US President Donald Trump’s renewed tariff threats.
The US leader reiterated the US’ claim on Greenland Wednesday and said he’d hit European allies with trade tariffs, spooking markets and spurring an immediate sell-off across major assets, including bonds, stocks and crypto.
“ETFs continues to see outflows and on the desk we’ve noticed a pickup in off-ramping activity from stables to fiat, which indicates some reversal in mainly institutional participation which was picking up at the start of the year,” Jasper De Maere, desk strategist at market maker Wintermute, said in a Friday note shared with DL News, “noting geopolitical jitters” as a main catalyst.
Though the stock market rebounded Friday after Trump on Thursday reversed course on Europe tariff threats. Bitcoin and other digital coins and tokens are still down.
Experts earlier in the week told DL News that Bitcoin could drop as low as $75,000 due to increased volatility.
Should investors be worried?
Bitcoin is down 29% from the record of $126,080 it touched in October, and has largely struggled to recover from a sell-off that month when over $19 billion in leveraged positions were liquidated — the largest such event in the history of digital assets.
Things were looking up for crypto markets at the start of the year when US investors pumped over $1.5 billion in fresh cash at Bitcoin and Ethereum ETFs over the space of two days.
But geopolitical headwinds haven’t helped the digital coin — which has typically traded in line with other “risk-on” assets — either.
Still, investors are reminded to zoom out, according to experts, bearing in mind that long-term gains are what one should pay attention to with digital assets.
“Sometimes with Bitcoin, you have to really focus on the annualized return,” Bloomberg’s senior ETF analyst told DL News, adding that all things are in place — such as government debt and increased liquidity — for the asset to have a good 2026.
Uncorrelated returns
Following the COVID-19 pandemic, Bitcoin largely traded in correlation with tech stocks. But its returns are becoming more de-coupled from other assets.
Last year, Bitcoin finished in the red while stocks finished on a high. But while some investors bemoaned this, it’s actually what they should look for, added Balchunas.
“If you want Bitcoin to be seen as an alternative, you want it to act in a way that isn’t expected,” he said, adding that investors should pay less attention to short-term news that causes Bitcoin’s price dips and use the asset as something over the long-term that can give returns when other assets don’t.
Mathew Di Salvo is a news correspondent with DL News. Got a tip? Email at mdisalvo@dlnews.com.
