Bitcoin saw a dramatic decline, falling below $63,000 on Thursday, marking a staggering 50% drop from its all-time high of over $126,000 recorded in October 2025. According to Bitcoin magazine, this decline represents the “largest dollar value drawdown in Bitcoin’s history.” The impact of this downturn was felt across the entire cryptocurrency market, with Ethereum, BNB, Ripple, and virtually all notable altcoins experiencing significant losses.
This sudden crash is particularly shocking, especially considering the optimism many traders had regarding Bitcoin’s potential to reach new highs by 2026. President Donald Trump had previously positioned himself as a supporter of cryptocurrency enthusiasts, which many believed contributed to the market’s brief surge in 2025. However, economist Paul Krugman highlighted a “crisis of faith” in the market during his recent appearance on Bloomberg News. He argued that the libertarian ideology that originally supported Bitcoin is no longer valid, as the cryptocurrency has become increasingly intertwined with political influences, particularly those related to Trump’s future in politics.
Krugman noted that Bitcoin is nearly as old as the iPhone, which debuted in 2007, yet has only demonstrated its value as a speculative asset. As a result, it has not developed practical utility, leaving traders to merely speculate on its value without any intrinsic application. The current downturn reflects a broader disillusionment within the market.
In a related development, Strategy, the company founded by Michael Saylor and known for accumulating Bitcoin aggressively, disclosed a staggering net loss of $12.4 billion for the fourth quarter, suggesting that its ambitious financial strategy may be unraveling.
The political ramifications of the cryptocurrency downturn are also significant. The wealth amassed by Trump’s family in the crypto sector has raised eyebrows, particularly in light of recent investments. A notable example is the $500 million investment by a firm linked to UAE National Security Adviser Sheikh Tahnoon bin Zayed Al Nahyan in World Liberty Financial, a venture associated with Trump’s sons. This situation has prompted calls for accountability regarding foreign influence on U.S. politics, but it seems unlikely that meaningful repercussions will follow.
Amid this chaos, many politically opposed to Trump appear to be hopeful for the collapse of Bitcoin and other cryptocurrencies, viewing it as a potential form of justice against the former president. The Democratic Party humorously commented on the crypto crash, posting a picture of Trump accompanied by the phrase, “Crypto crash accelerates as investors flee risky assets.”
In response, proponents of cryptocurrency voiced their concerns about the lack of empathy directed toward affected investors. One crypto investor criticized the political mockery, arguing that it exemplified a poor approach during discussions of necessary regulations aimed at protecting investors and fostering innovation.
The public sentiment surrounding this issue illustrates a deepening political divide. Many individuals expressed a lack of sympathy for those who have financially suffered, with some comments reflecting a stark condemnation of Trump’s influence in the crypto market. The ongoing turmoil captures not only the shifting dynamics within the cryptocurrency space but also highlights the intertwining of financial markets with political narratives in contemporary America.
