Bitcoin and other major cryptocurrencies fell sharply just after public support for the digital assets from Donald Trump.
Bitcoin dropped more than 3% on Wednesday to about $72,800, its lowest level since mid-April, while Ethereum fell below the $2,000 mark. The crypto market lost more than $80 billion in value within 24 hours, according to market tracking data.
The decline came shortly after Trump posted messages on Truth Social defending the cryptocurrency industry and promising continued government support for the sector in the United States.
“America is now the crypto capital of the world, and builders and entrepreneurs are coming back to the United States where they belong,” Trump wrote.
He added: “Under my leadership, we will codify a future-proof digital asset market structure that cannot be undone by the crypto haters. The new frontier of finance is being built in America, and Trump will never let crypto down.”
Despite the remarks, the renewed military tensions involving the United States and Iran has caused investors to draw back.
US forces carried out strikes linked to Iranian military targets near the Strait of Hormuz, while Iran responded with military action involving a US base in Kuwait. Fears of further instability in the Middle East has pushed investors away from volatile assets such as cryptocurrencies.
The market decline was intensified by large liquidations across crypto derivatives exchanges. Data from Coinglass showed about 165,000 traders were liquidated over a 24-hour period, with total losses approaching $928 million. Most of the liquidated positions were bets that prices would rise.
Institutional demand for Bitcoin also appeared to weaken. Reports cited market data showing that spot Bitcoin exchange-traded funds recorded more than $1.5 billion in outflows over the past seven days.
Analysts at Bitfinex said investors were becoming cautious ahead of major US economic reports, including inflation and GDP figures that could influence future interest-rate decisions by the Federal Reserve.
They also noted that Bitcoin futures open interest had fallen sharply since mid-May, suggesting reduced confidence among leveraged traders.
Meanwhile, Dogecoin also moved lower with the market, falling more than 3%.
Although Dogecoin remains one of the most widely recognised cryptocurrencies, it continues to rely heavily on speculative trading activity and online sentiment rather than strong institutional adoption or technical development.
A separate analysis by The Motley Fool said Bitcoin remains the stronger long-term asset because of its larger market position, integration into traditional finance and fixed supply model.
Dogecoin has a market value of about $17.7 billion but has limited commercial use and a relatively small developer base compared with larger blockchain networks.
Crypto analysts say traders are now closely watching whether Bitcoin can hold support near the $70,000 level especially with the uncertainty right now across global financial markets.
