Bitcoin Slides Below $80,000 After Brutal Weekend as Fed Fears, Liquidations, and Global Tensions Collide

Bitcoin fell sharply over the weekend, slipping below the $80,000 mark for the first time since April 2025 and briefly touching a nine-month low near $74,900 before stabilizing around $77,000 in early Monday trading. The move capped one of the cryptocurrency’s worst weeks in years, erasing more than $200 billion in market value and triggering roughly $2.5 billion in forced liquidations.

The selloff leaves Bitcoin down about 12% over the past week and nearly 40% from its October 2025 peak near $125,000. It also marks the fourth straight monthly decline, the longest losing streak since the 2018 crypto winter, raising fresh questions about whether the market is approaching a bottom or bracing for further downside.

A Fed Nomination That Rattled Risk Assets

The immediate trigger for the latest leg down came late Friday, when President Donald Trump announced the nomination of Kevin Warsh to replace Jerome Powell as Federal Reserve chair. Markets reacted swiftly. Bitcoin dropped roughly 7% within hours of the announcement, falling from the low $90,000s into the low $80,000s before the selling intensified over the weekend.

Warsh is widely viewed as a monetary policy hawk, known for opposing aggressive stimulus during his time at the Fed following the 2008 financial crisis. Investors fear his leadership could mean tighter liquidity, higher interest rates for longer, and a stronger U.S. dollar, all conditions that have historically weighed on cryptocurrencies.

While Warsh has recently struck a more neutral tone on Bitcoin itself, his broader stance on inflation and balance sheet restraint introduced uncertainty at a moment when markets were already fragile.

Liquidation Cascade Amplifies the Fall

What began as a policy-driven selloff quickly turned into a liquidation cascade. On Saturday alone, more than $2.5 billion in leveraged crypto positions were wiped out, ranking among the ten largest single-day liquidation events in the sector’s history.

Most of the damage came from long positions, as traders betting on a rebound were forced out when prices broke key technical levels. Thin weekend liquidity magnified the impact, allowing relatively small sell orders to push prices sharply lower.

Ethereum, Solana, and other major tokens followed Bitcoin down, with double-digit percentage losses at the worst point of the move. By Monday morning, the broader crypto market had lost roughly $200 billion in value over just a few days.

Geopolitical Stress Adds to Risk-Off Mood

The crypto selloff did not occur in isolation. Escalating geopolitical tensions also weighed on global markets. Over the weekend, Iran warned that any U.S. military action could trigger a wider regional conflict, while reports emerged of incidents near major Iranian ports.

At the same time, renewed rhetoric from President Trump around tariffs and global trade revived memories of earlier policy shocks that had roiled financial markets. Even traditional safe-haven assets struggled. Gold fell sharply on Monday after an initial spike, underscoring the depth of the current risk-off sentiment.

Bitcoin, often promoted as “digital gold,” failed to act as a hedge. Instead, it traded more like a high-beta risk asset, moving in step with technology stocks and other speculative investments.

Institutions Pull Back, Structural Selling Builds

Beyond short-term headlines, Bitcoin faces deeper structural pressures. Digital asset investment products recorded another $1.7 billion in outflows last week, marking the second consecutive week of heavy institutional selling and bringing year-to-date outflows to roughly $1 billion.

On-chain data shows long-term holders distributing coins at a pace of about 12,000 BTC per day over the past month. Bitcoin miners have also been sending coins to exchanges, a sign they are selling to cover costs amid declining profitability.

Together, these flows have created persistent sell pressure that limits the impact of short-term bargain hunting.

Technical Damage and Extreme Fear

From a technical perspective, Bitcoin has broken several critical support levels, including its 200-day moving average. Momentum indicators remain deeply negative, and market sentiment has collapsed.

The Crypto Fear and Greed Index dropped to 14 on Monday, a level classified as “extreme fear.” Historically, such readings often appear near market bottoms, but they do not guarantee an immediate recovery. Markets can remain fearful for extended periods, especially when macro uncertainty dominates.

What Comes Next

Analysts are now split on Bitcoin’s near-term path. Some see the combination of mass liquidations, extreme pessimism, and oversold technical conditions as signs that a temporary floor may be forming in the $74,000–$78,000 range.

Others warn that a decisive break below $70,000 could open the door to a deeper correction toward $60,000 or lower, particularly if tighter monetary policy expectations harden or geopolitical risks escalate further.

For now, Bitcoin’s brutal week has exposed a core tension in its narrative. Despite claims of being a safe haven, the cryptocurrency is still behaving like a risk asset, highly sensitive to policy shifts, liquidity conditions, and global uncertainty.

Whether this selloff marks capitulation or just another leg down will likely depend on how the Federal Reserve’s leadership transition unfolds, whether institutional investors return, and whether global tensions cool or intensify in the days ahead.