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The cryptocurrency market experienced a sharp decline on Monday, with Bitcoin temporarily dropping below $77,000 before slightly rebounding to $81,500 at the time of writing. Ether, the second-largest cryptocurrency by market capitalization, fell to its lowest level since October 2023, around $1,820. Other popular cryptocurrencies such as Dogecoin, XRP, and Cardano also saw drops exceeding 10%, with Dogecoin experiencing the steepest decline (-14%).
For those looking for an attractive entry point directly on the 30-week moving average—which has acted as support for the current bull market that began in January 2023—this could be the long-awaited opportunity. Our experience has shown that individual investors often find it challenging to take advantage of opportunities following a decline. However, history teaches us that buying after such pullbacks is the best way to maximize long-term returns, provided one remains bullish on the asset class.
This widespread downturn occurs amidst an uncertain economic climate, exacerbated by recent statements from U.S. President Donald Trump regarding Bitcoin reserves and international trade tensions. Increased U.S. tariffs on Chinese imports, set at 20%, along with the threat of similar measures against Canada and Mexico, have heightened fears of a potential recession, negatively impacting traditional stock markets as well. The Nasdaq experienced its worst daily drop since September 2022, falling by 4% in a single session.
Additionally, the current investor distrust is driven by fundamental factors: disappointment regarding the “U.S. Bitcoin Strategic Reserve,” which turned out to be merely a management system for Bitcoins seized by the FBI (approximately 200,000 BTC), along with concerns about the impact of trade tensions and recession risks in the U.S. Recent revelations of North Korean cyberattacks on crypto platforms, where hackers discreetly converted around $300 million out of a total of $1.5 billion stolen, likely represent an irreversible loss. These elements fuel a climate of generalized caution that could persist as long as global economic uncertainty remains high.
Analysts argue this downward movement is not tied to any single piece of news but rather reflects an overall atmosphere of uncertainty and nervousness in global financial markets. Arthur Hayes, co-founder of BitMEX, advises patience, emphasizing that a 36% correction from an all-time high is normal in a bullish market. According to him, the bottom could be around $70,000. Peter Chung, an analyst at Presto Research, highlights the importance of monitoring signals from the U.S. Federal Reserve during the upcoming FOMC meeting next week, especially any hints regarding future monetary easing that could stabilize markets.
Amid heightened volatility, Bitcoin’s relevance as a safe-haven asset is being questioned. While some hope Bitcoin could become a digital alternative to gold (“digital gold”), it continues to behave more like a high-risk technology stock, moving closely with equity markets rather than diverging from them. James Lienkha, an executive at The Block, points out that investors traditionally prefer bonds, particularly U.S. Treasury bills, as secure assets when recession risks rise. He thus doubts Bitcoin’s ability to fulfill a defensive role in prolonged economic uncertainty. Could Bitcoin finally demonstrate its value proposition as a safe haven during this turbulent economic context?
U.S. platform Coinbase is set to launch a new offering that allows American users to trade Bitcoin and Ethereum futures contracts continuously, 24/7. This initiative aims to compete with international platforms already offering these continuous services, providing American traders with similar flexibility. Coinbase states this responds to strong demand from cryptocurrency investors seeking constant market access to quickly exploit opportunities or manage risks effectively. The goal is to offer a more competitive U.S. trading environment aligned with international standards, ensuring constant exposure to Bitcoin and Ethereum. The cryptocurrency derivatives market, which Coinbase aims to enter more significantly, vastly surpasses the traditional spot crypto market. In just 24 hours, global crypto trading volumes reached around $151 billion on spot markets versus nearly $879 billion on derivatives markets, clearly demonstrating the growing investor interest in these advanced financial products.
President Donald Trump is considering signing a new executive order aimed at facilitating crypto companies’ access to banking services. This measure specifically seeks to reverse restrictions imposed under the Biden administration, known as “Operation Chokepoint 2.0,” which made obtaining financial services extremely difficult for cryptocurrency firms. A major consequence of this new decision would allow specialized crypto banks direct access to services from the U.S. Federal Reserve. Until now, the inability for specialized banks like Custodia to access Fed services has been a significant barrier to the crypto industry’s development. However, it’s important to note that the Federal Reserve is theoretically independent of the executive branch and is not obligated to follow presidential directives. The presidential decree could also clarify that stablecoins should not be considered securities. If confirmed, this would mark Trump’s third favorable cryptocurrency-related executive order since returning to office, following the creation of a presidential task force on digital assets and the recent establishment of a strategic U.S. Bitcoin reserve.
El Salvador continues its Bitcoin acquisition strategy despite pressure from the International Monetary Fund (IMF). Last Sunday, the country added 6 Bitcoins to its reserves, bringing the total holdings to 6,111.18 BTC. This decision comes despite El Salvador having previously agreed in December to certain conditions set by the IMF in exchange for a $1.4 billion loan, including significantly reducing governmental economic activities related to Bitcoin, notably direct government purchases. Nigel Clarke, Deputy Managing Director of the IMF, recently reiterated El Salvador’s commitment to limit official transactions and governmental involvement in Bitcoin’s economy. These constraints aim to strictly regulate public crypto-related activities to mitigate potential economic risks.
U.S. company Strategy, formerly MicroStrategy, plans to sell up to $21 billion in preferred shares to continue investing in Bitcoin. This announcement follows a recent White House visit by executive chairman and co-founder Michael Saylor. However, the company clarified in official filings that there is no guarantee this financial operation will happen or that the full proposed amount will be raised. These preferred shares, named “STRK,” will be offered in collaboration with around a dozen financial institutions. The initial goal, announced last January, was to raise $2 billion through these preferential shares, offering investors an 8% cumulative annual dividend payable either in cash or common stock. Despite ambitious plans, Strategy has slowed its recent Bitcoin purchases. Since its last major investment in February, when the company bought approximately $1.9 billion in Bitcoin at an average price of $97,500, no new acquisitions have been reported.
Despite short-term pessimism, analysts like Aurelie Barthere (Nansen) and Arthur Hayes, co-founder of BitMEX, see this correction as completely normal in an overall bullish market. According to them, a drop towards $70,000-$72,000 is typical after significant rallies, not indicative of a sustained downturn. This area notably aligns with levels observed before U.S. elections and serves as a potential support before a rebound. Arthur Hayes further emphasizes this correction aligns with usual movements in bullish markets, recalling historical precedents where similar declines preceded new upward phases, often boosted by quantitative easing policies from major central banks (Fed, ECB, Bank of Japan, and the Chinese central bank). These accommodative monetary policies have historically increased market liquidity and have often supported Bitcoin.
In the short term, crossing back above the 200-day moving average would provide momentum for a rebound following yesterday’s low.
Finally, despite current turbulence, analysts remain optimistic in the long term regarding Bitcoin’s price trajectory. Multiple forecasts continue to predict significant price increases by the end of 2025, substantially above current levels. This positive outlook is based on expectations that macroeconomic factors, particularly anticipated monetary easing measures in major global economies, will drive another substantial rise in Bitcoin.
The presented information is as of March 11th, 2025, unless otherwise indicated and is provided for information purposes only. The information comes from sources that we believe are reliable, but not guaranteed. This statement does not provide financial, legal or tax advice. Rivemont Investments are not responsible for any errors or omissions in the information or for any loss or damage suffered.
