The cryptocurrency, which has tracked swings in technology stocks in recent months, mirrored early weakness in US equities but failed to recover when stocks later fully edged higher.
Noelle Acheson, author of the Crypto is Macro Now newsletter, told Bloomberg, “Sentiment is clearly bleak in crypto markets,” adding that the strong progress in adoption by traditional institutions is not reflected in overall prices, “which depresses sentiment even more.”
Markets have been unsettled by uncertainty over AI’s economic impact, including concerns that it could disrupt parts of the economy and doubts about whether heavy spending on AI will generate near-term returns.
Fund flows have also remained a drag. About $360 million was withdrawn from US-listed Bitcoin exchange-traded funds last week, marking a fourth consecutive week of net outflows.
Investor sentiment remains fragile as Data from CryptoQuant showed its Fear and Greed Index at 10 out of 100, deep in “extreme fear” territory.
Paul Howard, senior director at market maker Wincent, expects Bitcoin to consolidate as it searches for fresh catalysts, adding that a pending US Supreme Court ruling on tariffs could prove more significant for markets than routine Federal Reserve minutes or inflation data.
The debate over whether Bitcoin has formed a durable floor is also ongoing, with many viewing $60,000 as a key support level. Robin Singh, chief executive of crypto tax platform Koinly, warned that it may not hold if risk appetite weakens further.
“One macro wobble, another wave of uncertainty, or even just sustained chop in the mid-$60,000s could easily tip this into a sharper flush back into the $50,000s,” Singh told Bloomberg.
Some investors remain constructive despite the recent weakness. Matt Hougan, chief investment officer at Bitwise Asset Management, told Bloomberg, “I expect the recovery from this bear market to be rounded, not v-shaped.”
He added, “There is actually a lot of very good news in crypto that is not being recognised by the market. It’ll get there over time.”