Bitcoin’s price has dropped significantly, slipping below $90,000 for the first time since November 2024. As of February 25, 2025, the leading cryptocurrency is trading at approximately $86,962, marking an 8% decline from its previous close. This downturn aligns with a broader selloff in the crypto market, affecting major digital assets.
Key Factors Behind Bitcoin’s Decline
Several factors have fueled this latest selloff, including global economic concerns, security breaches, and shifting political dynamics.
Investor sentiment has been shaken by increasing economic uncertainty, particularly due to U.S. trade policies. President Donald Trump’s reaffirmation of a 25% tariff on imports from Canada and Mexico has raised concerns over escalating trade tensions and inflationary pressures. As a result, investors are pulling back from riskier assets, including cryptocurrencies.
Security Breach at Bybit Exchange
The crypto industry’s security vulnerabilities have also contributed to market instability. Last week, Dubai-based exchange Bybit suffered a massive hack, leading to the theft of approximately $1.5 billion worth of Ether. This breach, one of the largest in crypto history, has weakened investor confidence in the security of digital asset platforms.
Despite initial optimism surrounding President Trump’s re-election and expectations of pro-crypto policies, recent political events have dampened enthusiasm. Efforts to establish state-level Bitcoin reserves in Montana, North Dakota, and Wyoming have failed, underscoring the political resistance to integrating cryptocurrencies into government financial strategies.
Ripple Effects on Crypto-Exposed Stocks
Bitcoin’s downturn has also impacted traditional financial markets, with companies heavily invested in digital assets experiencing declines. Coinbase Global and MicroStrategy, both with significant exposure to crypto, have seen their stock prices drop alongside Bitcoin’s fall. This trend highlights the increasing correlation between cryptocurrencies and traditional equities.
Bitcoin’s fall below $90,000 is the result of a mix of economic policy shifts, security risks, and political headwinds. As investors navigate this evolving landscape, market watchers are closely analyzing these factors to gauge their long-term implications for the cryptocurrency sector.
