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Bitcoin briefly sank below $61,000 on Thursday evening as investor confidence continued to falter in the asset once hailed as "digital gold" and a unique store of value. At one point, the token slid to $60,062.00, as the crypto sell-off intensified in overnight trading. Bitcoin was last down about 15% at 7:37 p.m. ET, trading at $62,448.00. Digital assets, including bitcoin, have fallen deeper into the red as investors re-assess the practical utility of a token that has been championed not only as a hedge against inflation and macroeconomic uncertainties but also as an alternative to fiat currencies and traditional safe-havens such as gold. That hasn't panned out lately, since bitcoin peaked just north of $126,000 in early October. The cryptocurrency broke below the key level of $70,000 earlier in the session Thursday and then the selling increased, bringing the asset closer in line with its pre-election level. The cryptocurrency is down almost 30% this week alone.
Stock Chart Icon Stock chart icon Bitcoin, 1 day
"This steady selling in our view signals that traditional investors are losing interest, and overall pessimism about crypto is growing," Deutsche Bank analyst Marion Laboure said Wednesday in a note to clients. Growing investor caution comes as many of the sensationalized claims about bitcoin have failed to materialize. The token has largely traded in the same direction as other risk-on assets, such as stocks, particularly during recent geopolitical and macroeconomic flare ups in Venezuela, the Middle East and Europe, and its adoption as a form of payment for goods and services has been minimal. Bitcoin underperforming gold Bitcoin is down nearly 40% over the past year, while gold futures have gained 61% in the same period. Other cryptocurrencies are cratering, too. Ether has pulled back 33% this week. Solana hit $88.42 on Thursday, about a two-year low. That cryptocurrency is off nearly 40% on the week. Some traders have suggested $70,000 is a key level to watch for bitcoin, and a break below that could trigger further declines. James Butterfill, head of research at Coinshares, said $70,000 is shaping up as a "key psychological level," adding that "if we fail to hold it, a move toward" the $60,000 to $65,000 range "becomes quite likely."
Stock Chart Icon Stock chart icon The price of bitcoin over the last year.
The latest move in bitcoin comes amid a worsening sell-off in U.S. tech stocks. The State Street Technology Select Sector SPDR ETF (XLK) dropped 1.8% on Thursday, marking its third straight losing day. Meanwhile, precious metals continue to be volatile too, with silver plunging again on Thursday and gold under pressure. Forced liquidations — when traders' positions are automatically sold as bitcoin hits a set price — continue to weigh on markets. As of Thursday, more than $2 billion in long and short positions in cryptocurrencies have been liquidated this week, according to data from Coinglass. Bitcoin has been on a steady decline for more than three months, and is now more than 50% below its October high. Other cryptocurrencies, including ether and XRP , have fallen even more. "[The] straight line bull run that a lot of people expected hasn't really materialized yet. Bitcoin isn't trading on hype anymore, the story has lost a bit of that plot, it is trading on pure liquidity and capital flows," Maja Vujinovic, CEO of digital assets at FG Nexus, told CNBC's "Worldwide Exchange."
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