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Bitcoin saw its trading volume surge by 222% on Monday, reaching $55.3 billion, yet the cryptocurrency’s price dropped by 8.7%, falling from its January 20 all-time high of $108,000 to $98,941. Analysts now predict a sharp correction that could see Bitcoin tumble to $70,000 before potentially soaring to $250,000 later in the year.
Despite President Donald Trump’s recent push to draft new crypto regulations, the anticipated market boost failed to materialize, with Bitcoin losing nearly 9% in the past 24 hours. This marks the first significant retreat in what was dubbed the “Donald Trump crypto frenzy,” as the market reacts to the unfolding regulatory changes.
Analysts estimate that Bitcoin’s price may fall further to as low as $70,000 before rising to as high as $250,000 later this year, highlighting the unpredictable nature of the digital currency industry. This volatility is also visible in the cryptocurrency derivatives market, which has seen $850 million in forced liquidations in the last 24 hours, with long holdings being struck the most.
The White House cryptocurrency policy working group formed by President Trump received a variety of responses from both supporters and critics. Some industry professionals embrace regulatory clarity yet others worry it will dampen innovation and hamper market growth. Trump’s executive orders provide a six-month timeline for creating digital asset regulations while leaving market players unsure about the future consequences.
The momentum behind the “Donald Trump crypto frenzy” diminished after Trump attempted to establish U.S. dominance in cryptocurrencies which resulted in Bitcoin rolling back from its peak price levels. The adaptation of the cryptocurrency market to recent developments necessitates that investors exercise prudence and prepare for further fluctuations in market dynamics.
