BTC Continues Losing Ground as Risk-Off Sentiment Persists

Bitcoin and crypto-related shares extended their nearly two-month slide on Dec. 1, mirroring a broader retreat in tech shares that many investors argue have climbed too far, too fast.

Bitcoin dropped 5.6%, settling slightly above $86,000. Data from Coinbase shows the crypto is down 33% since reaching a record high of $126,210.50 in October. That peak followed a surge that began in April as crypto markets rose alongside equities and benefited from what many viewed as friendlier signals from policymakers in Washington.

Crypto-related companies also faced heavy pressure. Coinbase Global slipped 4.8% and Robinhood Markets lost 4.1%, while Riot Platforms, a major mining operation, declined 4%. Strategy, the largest institutional Bitcoin holder, dropped 3.3%. The firm recently reported holding 649,870 BTC, valued at $55.7 billion.

Strategy predicts Bitcoin ending the year between $85,000 and $110,000, trimming expectations from a late October forecast that projected $150,000.

American Bitcoin, a company in which Donald Trump Jr. and Eric Trump hold stakes, suffered one of the sharpest losses. Its shares fell 15.6% and have dropped 47% since late September.

Other ventures linked to the Trump family also declined. World Liberty Financial’s token, WLFI, has seen its market value drop to $4.14 billion from more than $6 billion in September. A meme token named after Trump, trading under the symbol TRUMP, now sits at $5.70, far below the $45 level seen just before his inauguration in January.

Flows out of crypto-related funds show how quickly sentiment has shifted. Morningstar Direct data showed that investors withdrew $3.6 billion from Bitcoin spot exchange-traded funds in November, the largest monthly pullback since crypto spot ETFs launched in January last year.

Additionally, Bitcoin futures have fallen 24% over the last month. Gold futures, meanwhile, have climbed almost 7% as traders seek safer positions.

Analysts cite a broad move away from riskier assets this fall, combined with growing interest in bonds and gold. Deutsche Bank noted last week that institutional selling, profit taking among long-term holders, and concerns about a more aggressive Fed have weighed on crypto assets.

The bank also noted that stalled regulation has added to uncertainty. The industry saw progress in July when President Trump signed rules establishing initial consumer protections for stablecoins, which are backed by financial assets such as the USD.

However, a measure that would set a new framework for crypto markets remains stalled in Congress. The legislation has been a major goal for crypto companies that spent heavily to support Trump and other allies during the 2024 election cycle.

This current drawdown in the price of Bitcoin could open opportunities for accumulation companies like American Bitcoin Corp. (NASDAQ: ABTC) to assess whether adding onto their holdings is warranted at this time before the crypto’s price starts climbing again.

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