Bitcoin’s Quick Bounce Back After Market Sell‑Off

Bitcoin surged from a low near $60,000 to roughly $69,000, erasing gains made after Donald Trump’s November 2024 election.
This rally unfolded amid a broader market sell‑off:

• CoinDesk 20 Index fell more than 17% in a single week.
• Bitcoin declined about 16.5%; Ether, BNB, and Solana dropped 22–25%.
• Crypto‑linked stocks slipped even after Bitcoin briefly hit $70,000.

A sharp one‑day drop the day before was labeled by Wintermute as the largest single‑day loss since the FTX collapse. Market liquidations and a “sell at any price” dynamic pushed prices lower, though institutional traders reported only modest liquidations—insufficient to fully explain the magnitude of the move.

The slump coincided with broader market retracements:

• Nasdaq 100 dropped ~5% over three days.
• Precious metals fell 38% for silver and 12% for gold.
• Crypto options volatility spiked to the 99th percentile; put options became pricier.

Regulatory and Corporate Shifts

• Gemini announced it will shut operations in the UK, EU, and Australia, cutting 25% of staff.
• The exchange will switch to withdrawal‑only mode in those regions and partner with eToro for asset transfers.
• Bitfarms’ shares rose after pivoting from Bitcoin to AI infrastructure.

Market Depth and Investor Impact

• Bitcoin’s market depth has shrunk, leading to sharper price moves.
• Spot Bitcoin ETFs experienced net outflows of about $1.25 billion in three days, leaving holders with significant unrealized losses.
• Analysts note that Bitcoin’s recent decline mirrors the behavior of software stocks, which fell after new AI tools were released.