(Bloomberg) -- Bitcoin posted its longest losing streak in the period since Donald Trump’s US election victory, after a failed run at $100,000 cooled the speculative fervor sparked by the president-elect’s embrace of crypto.
The four straight days of declines have lopped about 9% off the digital asset, which traded at $91,100 as of 3:23 p.m. Tuesday in New York. The wider crypto market gave up some of its $1 trillion advance since Election Day on Nov. 5.
The difficulty of trying to crack $100,000 for the first time “could convince traders that the top is in, and profits should be locked in now,” wrote Noelle Acheson, author of the Crypto Is Macro Now newsletter. However, any such episode should be “fleeting,” she added.
Cryptocurrencies also faced a bout of risk aversion earlier Tuesday after Trump roiled markets by vowing additional tariffs on China as well as US neighbors Canada and Mexico.
High-flying crypto-related stocks such as MicroStrategy also declined. The Bitcoin proxy slumped around 13%, though it remains up more than 400% this year. Coinbase, the largest US crypto exchange, fell around 6%.
“People have been looking for an excuse to take some profits,” said Adrian Przelozny, chief executive of crypto exchange Independent Reserve. “We’re still very confident the current bullish market sentiment will continue into 2025.”
Trump’s Pledges
Trump has pledged to make the US the global home for crypto by fostering supportive regulations as well as a national Bitcoin stockpile. Questions remain about how quickly he can make the changes and whether all are feasible.
In a research note, TD Cowen analyst Jaret Seiberg said the president-elect after his Jan. 20 inauguration “will gain immediate control of the Securities & Exchange Commission,” adding that would be a “positive sign when it comes to easing crypto enforcement and facilitating a path to compliance.”
Trump, a onetime crypto skeptic, pivoted into a supporter after digital-asset firms spent heavily during election campaigning to promote their interests. Growing signs emerged in recent days of a tightening US embrace of crypto.
As a result, approximately $7 billion poured into US spot-Bitcoin exchange-traded funds after the election, according to data compiled by Bloomberg. But the dozen ETFs saw a $438 million outflow on Monday as demand eased.
“Such profit-taking is natural after a strong accumulation phase, and we anticipate these outflows will not last more than 2–3 days before institutional demand returns,” said Valentin Fournier, a BRN analyst.
©2024 Bloomberg L.P.