Key Takeaways
- Bitcoin briefly fell below $50,000 Monday as market sell-off spread to crypotcurrencies leading to $1.2 billion in crypto liquidations.
- Ether, Solana, and other alternative crypto assets are down even more than bitcoin.
- Despite bitcoin’s aspirations to be a safe-haven asset, its recent price movements show that it’s still operating as a risk-on asset today.
Bitcoin (BTCUSD) briefly plummeted below $50,000 Monday for the first time since February as U.S. economic fears spread the market rout beyond stocks, leading to about $1.2 billion in crypto liquidations over the past 24 hours.
It’s been a roller-coaster ride for bitcoin investors. This morning’s low was nearly 30% below the $70,000 price level bitcoin hit exactly a week ago. The largest cryptocurrency by market cap recovered somewhat, trading above $54,000 early Monday afternoon.
Bitcoin ETFs, Altcoins, Crypto-Related Stocks Tumble
As the stock market began to crumble Friday, nervous investors pulled out $237.4 million from spot bitcoin exchange-traded funds (ETFs), according to data from Farside Investors.
As is usually the case during crypto price declines, alternative crypto assets are down even more than bitcoin. Ether (ETHUSD) is down 24% over the past week, while Solana (SOLUSD) is down 28%.
Crypto-related stocks felt the double whammy of selling pressure from both the stock and the crypto markets. Shares of MicroStrategy (MSTR), one of the largest corporate holders of bitcoin, fell 9% while those of Block (SQ) and Coinbase (COIN) declined 2% and 5%, respectively.
Bitcoin miner stocks traded lower, too. Cleanspark (CLSK) was 11% lower, Hut 8 (HUT) was down 7%, Marathon Digital (MARA) declined 5%, while Riot Platforms (RIOT) fell 3%.
Bitcoin Drawdowns Not Uncommon
It’s not uncommon for bitcoin to have multiple large price drawdowns in bull markets following halving events such as the one that recently took place in April. Despite bitcoin’s intention to operate as a safe haven, its recent selloff along with the equities market indicates it’s still trading as a risk-on asset during times of global market uncertainty.
Still, that’s not enough to shake the confidence of some long-term bitcoin bulls.
“People smash the sell button for liquid assets during broad-based panics,” Bitwise Chief Investment Officer Matt Hougan posted on X. “But from my seat, today’s events play into the long-term story for bitcoin.”