Bitcoin is in the dumps.
The apex cryptocurrency is down more than 30% in 2026, slumping to its lowest level since 2024 this week to trade around $59,200. That marks about a 53% drop from the token's all-time high above $126,000 last October. Ethereum, the second-biggest crypto, is doing even worse, down 48% this year.
So, how did the Trump-era bullishness for crypto that took bitcoin to record highs give way to a brutal crypto winter that shows little sign of thawing?
Scanning around, there's little good news to be gleaned from the headlines. Interest from institutional and retail investors alike looks tapped out. That's evidenced by record outflows from bitcoin ETFs, which Deutsche Bank says have hit $6 billion in six weeks, the longest losing streak since the funds were launched in early 2024.
"This matters because ETF demand has become central to Bitcoin's price formation: the same vehicles that supported the 2024-25 rally now amplify the decline mechanically when flows reverse," the bank wrote this week.
And then there's Strategy. The business data firm founded by Michael Saylor, the "never sell" bitcoin evangelist, has sold some bitcoin.
"On 1 June, Strategy (formerly MicroStrategy) disclosed it had sold 32 bitcoin, its first sale since December 2022. The amount was negligible (0.004% of holdings) and the immediate price reaction was modest (~3%), but the signal was not," Deutsche wrote.
In the days following the sale, bitcoin dropped nearly 20%.
Selling by Strategy—which is the largest corporate holder of bitcoin—has been a looming question mark all year as the token's price has slumped below the Strategy's average cost. The difference in the firm's net asset value of its bitcoin holdings versus its market cap has driven speculation that it could sell more tokens, an event that would weigh further on sentiment.
"Bitcoin currently trades below Strategy's average cost of $75,699, and the market has begun to price the possibility of forced selling by leveraged corporate holders. We expect this question to persist," Deutsche analyst said.
Capital is also flowing away from bitcoin and into another speculative area of the market: AI. Analysts attribute much of the waning enthusiasm for crypto among retail traders directly to their relentless appetite for artificial intelligence. The rapid outflows from bitcoin ETFs in the last month have been mirrored in blistering pace of investing in many of the top AI and chip ETFs.
A final wrinkle is the surprisingly hawkish new Fed boss, Kevin Warsh. The policy meeting this month officially dashed all hope of a rate cut, with Warsh's first meeting further boosting odds of a rate hike, a bearish development for risk assets like bitcoin.
The apex cryptocurrency is down more than 30% in 2026, slumping to its lowest level since 2024 this week to trade around $59,200. That marks about a 53% drop from the token's all-time high above $126,000 last October. Ethereum, the second-biggest crypto, is doing even worse, down 48% this year.
So, how did the Trump-era bullishness for crypto that took bitcoin to record highs give way to a brutal crypto winter that shows little sign of thawing?
"This matters because ETF demand has become central to Bitcoin's price formation: the same vehicles that supported the 2024-25 rally now amplify the decline mechanically when flows reverse," the bank wrote this week.
And then there's Strategy. The business data firm founded by Michael Saylor, the "never sell" bitcoin evangelist, has sold some bitcoin.
"On 1 June, Strategy (formerly MicroStrategy) disclosed it had sold 32 bitcoin, its first sale since December 2022. The amount was negligible (0.004% of holdings) and the immediate price reaction was modest (~3%), but the signal was not," Deutsche wrote.
In the days following the sale, bitcoin dropped nearly 20%.
Selling by Strategy—which is the largest corporate holder of bitcoin—has been a looming question mark all year as the token's price has slumped below the Strategy's average cost. The difference in the firm's net asset value of its bitcoin holdings versus its market cap has driven speculation that it could sell more tokens, an event that would weigh further on sentiment.
"Bitcoin currently trades below Strategy's average cost of $75,699, and the market has begun to price the possibility of forced selling by leveraged corporate holders. We expect this question to persist," Deutsche analyst said.
Capital is also flowing away from bitcoin and into another speculative area of the market: AI. Analysts attribute much of the waning enthusiasm for crypto among retail traders directly to their relentless appetite for artificial intelligence. The rapid outflows from bitcoin ETFs in the last month have been mirrored in blistering pace of investing in many of the top AI and chip ETFs.
A final wrinkle is the surprisingly hawkish new Fed boss, Kevin Warsh. The policy meeting this month officially dashed all hope of a rate cut, with Warsh's first meeting further boosting odds of a rate hike, a bearish development for risk assets like bitcoin.
by Max Adams, Business Insider | Read more:
Image: Yahoo Finance; Jennifer Sor/BI
