Bitcoin’s Sharp Decline: Unpacking the Despite Trump’s Pro-Crypto Push

The crypto world is feeling the chill right now. Bitcoin, the top cryptocurrency, has dropped to levels not seen in over a year. Even with strong backing from U.S. President Donald Trump, prices are falling fast. What is causing this trend? Let’s break it down step by step.

What Happened to Bitcoin’s Price?

Bitcoin started the year strong but hit rough waters. It peaked above $127,000 last October. By December, it was around $90,000. Then, late January saw it dip below $80,000. This week, it fell under $66,000 and sat at about $62,900 by Friday morning.

That’s a rough 30% drop since January began. Other coins feel it too. Ether, the number two crypto, lost 19% this week, ending around $1,854.

• Key Price Points:
• October Peak: $127,000+
• December: ~$90,000
• Late January: Below $80,000
• Recent Low: ~$62,900

This isn’t just a small dip. It’s sparking talk of a full-blown .

Why the Sudden ?

Several forces are at play. Crypto doesn’t exist in a bubble. It reacts to global markets.

1. Volatility in Stocks and Precious Metals

Global stock markets sold off due to geopolitical tensions. Gold and silver prices swung wildly too.

Gold hit a record near $5,595 per ounce last week, then crashed to $4,872. Silver peaked at almost $122, then fell to $77. A stronger U.S. dollar and world uncertainty pushed investors away from these safe-haven assets. Crypto got hit as a result.

2. Institutions Are Selling

Last year, big players bought Bitcoin through ETFs. This year, they’re cashing out. U.S. spot Bitcoin ETFs saw over $3 billion leave in January alone. November and December 2025 had $7 billion and $2 billion outflows.

Experts say this shows traditional investors losing faith. Demand from institutions has flipped from buying to selling.

3. Low Liquidity and Fading Hype

Crypto thrives on excitement. People buy in fear of missing out (FOMO). That drives high trading volumes and liquidity – the ease of buying or selling without big price swings.

Now, hype is gone. Volumes are down. Less liquidity means small sells cause big drops. It’s a vicious cycle: lower interest leads to more drops, which scares off more buyers.

What is a ?

A is a long stretch of falling or flat prices. It can last months or years. Triggers include bad economy, tight rules, or scandals.

We’ve seen them before:

• 2017-2018: Bitcoin peaked in Dec 2017, then crashed amid global regulations.
• 2021-2022: Peak in Oct 2021, winter hit after FTX collapse and liquidity crisis.

These periods test investors. But they end, often with big rebounds.

Trump’s Support: Why Isn’t It Enough?

Trump has been crypto-friendly. At a 2024 Bitcoin event, he called the U.S. the “crypto capital” and promised a Bitcoin reserve.

Key moves:

1. March 2025: Launched national strategic reserve with Bitcoin, Ether, XRP, Cardano, Solana.
2. July (last year): GENIUS Act for stablecoin rules and protections.
3. Last month: Draft laws to clarify crypto regs.

His family runs World Liberty Financial (WLFI), which launched USD1 – a dollar-backed stablecoin using U.S. treasuries.

Bitcoin soared after his White House return. But politics can’t beat macro forces like rates and global risks.

The Fed’s Role in Speeding Up the Drop

Things worsened after Fed Chair news. Trump picked Kevin Warsh to replace Jerome Powell, who Trump criticized for high rates.

Powell said on Jan 28 rates stay put. With Warsh’s appointment, markets panicked. Crypto hates high rates – they favor safer assets.

Analysts call this a turning point. The market was weak; this pushed it over the edge.

Is This Here to Stay?

History says no. Winters average 13 months. This one started early 2025.

Experts like those with winter experience say:

“It feels like despair now, but fundamentals haven’t changed. Spring is coming soon.”

Crypto’s core strengths – decentralization, scarcity, adoption – remain. Trump’s policies could spark recovery once macro calms.

What Should Investors Do Now?

Stay calm: Panics create buys.

• Dollar-cost average: Buy fixed amounts regularly.
• Diversify: Mix Bitcoin, Ether, stablecoins.
• Watch macros: Rates, stocks, geopolitics.
• Hold long-term: Winters end.

Tools like on-chain data from firms tracking wallets can spot bottoms.

Looking Ahead: Signs of Spring

Watch for:

• ETF inflows returning.
• Rate cuts.
• New adoption news.
• Stable hype cycles.

Bitcoin’s drop is painful, but builds stronger markets. Trump’s support adds tailwinds. Patient investors could see big gains.

Stay tuned as we track this saga.