Bitcoin is going through one of its biggest declines in the past two years. The cryptocurrency has already lost around 30% from its all-time high, and the burning question remains: how much further can it fall? In this article, we’ll break down the key reasons behind BTC’s price drop, potential support levels, and whether there’s a light at the end of the tunnel.
Why Is Bitcoin Falling?
1. Economic and Geopolitical Chaos
One of the main factors behind Bitcoin’s nosedive is growing economic uncertainty, fueled by trade tariffs. The U.S. recently announced new 10% tariffs on Chinese imports, triggering panic across financial markets. And it’s not just crypto feeling the heat, stock indices like Nasdaq also took a hit.
To make matters worse, Donald Trump confirmed his intentions to move forward with 25% tariff on imports from Canada and Mexico. As a result, the total crypto market cap has fallen by 8.5%, while the U.S. stock market lost 1.5% in just one day.
2. Massive outflow from Bitcoin ETFs
Recent weeks have seen a record interest decline in Bitcoin ETFs. Over the past few weeks, a record-breaking $3.6 billion has flowed out of these funds, with a staggering $1.1 billion withdrawn on February 25 alone. This signals a loss of confidence from the very investors who once fueled BTC’s rally.
3. Bybit $1.5 Billion Hack
An additional blow to the market was the largest hack in the crypto history of Bybit exchange, as a result of which the attackers stole Ethereum worth about $1.5 billion. The incident has undermined confidence in the industry and increased market volatility.
At this point is really not about bybit or any entity, it's about our general approach towards hackers as an industry, really hope that @eXch can reconsider and help us to block funds outflowing from them. We are also getting help from Interpool and international regulatory… https://t.co/wRzN925X9l
— Ben Zhou (@benbybit) February 23, 2025
Where’s the Bottom?
Current support levels suggest that Bitcoin’s decline might not be over just yet. Some analysts, like BitQuant, predict that BTC will hit $76,000 before making a recovery.
If the chart below were updated based on the new information, it would show first $75K–$80K, then up only. #Bitcoin https://t.co/M4GeexZzFZ pic.twitter.com/10G2HZUf5S
— BitQuant (@BitQua) December 5, 2024
Others, including the anonymous trader Magus, believe the bottom could be closer to $70,000, as this level aligns with Bitcoin’s price on U.S. election day.
I wouldn't bet on any bottoms until 70k
— Magus (@TraderMagus) February 28, 2025
I expect all bounces to get sold into until then
Preserve your chips pic.twitter.com/Qt9k26CVa7
Another key technical factor is the CME futures gap. The gap in the $78,000–$80,700 range has almost been filled, but there’s still a chance that Bitcoin could dip further to the next major support level around $74,000–$70,000.
An additional factor pointing to a possible bottom is the relative strength index (RSI), which is currently at its lowest since August 2023. This could indicate that Bitcoin is in oversold territory and a rebound could soon follow.
When Can We Expect a Recovery?
Despite the recent downturn, Bitcoin remains an asset with strong long-term potential. However, don’t expect an instant rebound. There are a few key reasons why recovery might take some time:
Institutional investors are still on the sidelines
The significant outflow from Bitcoin ETFs in recent weeks suggests that many big players are cashing profits after BTC’s late 2024 – early 2025 rally. For now, they don’t seem eager to jump back. Ki Young Ju, founder of CryptoQuant, believes that this downtrend may continue for some time.
Regulatory uncertainty remains high
The European Union is rolling out updated MiCA regulations, which, while providing a legal framework, also introduce additional compliance requirements for crypto companies. This could slow down recovering.
The overall macroeconomic situation unstable
Amid geopolitical instability, including military conflicts, there is an interest decrease in high-risk assets such as Bitcoin and an increase in demand for safe-haven assets such as gold and US bonds.
However, if the $70,000 level holds and investors begin to show interest in Bitcoin ETFs again, a rebound to the $80,000-$92,000 zones is possible, where another unclosed CME gap is located.
The main support levels are currently in the $70,000-$76,000 range. If the price holds in this corridor, then a recovery can be expected in the coming months.
HODL Team
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