Bitcoin Plunges Below $65K as Supreme Court Strikes Down Trump’s Tariffs, Sparking Crypto Sell-Off
The cryptocurrency market experienced a sharp downturn on Monday, with Bitcoin dropping 4.5% to below $65,000, dragging the total market capitalization down 4.2% to $2.3 trillion.[1][2] This decline marks Bitcoin’s fifth consecutive month of losses and comes amid heightened macroeconomic uncertainty following a landmark U.S. Supreme Court decision striking down most of President Donald Trump’s sweeping tariff proposals.[1][4]
Supreme Court Ruling Ignites Risk-Off Sentiment
The primary trigger for today’s crypto plunge was the Supreme Court’s ruling against Trump’s global tariffs, which had been announced earlier and initially caused market panic.[4] Although the decision removes a layer of trade tension, it has paradoxically fueled investor jitters over future economic policy and regulatory shifts, particularly for speculative assets like cryptocurrencies.[4]
Bitcoin, often dubbed “digital gold,” fell as much as 5% in early trading, breaching the critical $65,000 support level—a psychological barrier that analysts view as key to short-term stability.[1][4] From a weekend close near $67,000, the cryptocurrency shed approximately $2,500 in about an hour due to thin weekend liquidity and insufficient buyers.[2]
Altcoins suffered even steeper losses. Solana (SOL) plummeted 9.1% to $77, Hyperliquid (HYPE) dropped 9.8% to $27, and Zcash (ZEC) slid 8.2% to $234.[1] The Crypto Fear & Greed Index sank to 5, signaling “Extreme Fear” among traders.[1]
Liquidations Surge, Amplifying the Drop
Forced liquidations played a pivotal role in exacerbating the sell-off. Data from CoinGlass showed 24-hour liquidations exploding 436% to $463 million, with long positions accounting for $432 million—or 93% of the total.[1] WazirX reported around $240 million in leveraged long liquidations alone, creating automatic sell pressure that blocked any quick recovery.[2]
Total open interest in cryptocurrencies fell 1.51% to $95 billion, while the market’s relative strength index hovered near oversold levels at 33, indicating weak momentum.[1] Large holders, or “whales,” added to the pressure by transferring substantial Bitcoin amounts to exchanges, a move often linked to selling or hedging.[2]
Broader Market Context: A Lingering Crypto Winter
Today’s action extends a painful trend for the crypto sector. Bitcoin is down nearly 24% year-to-date from January 1, trading around $65,000 after peaking at a record $126,210.50 on October 6.[3][4] Ethereum has fared worse, losing 34% to about $2,000—the worst starts to a year on record.[3]
The downturn follows a massive “flash crash” on October 10, triggered by Trump’s earlier tariff threats against China, which wiped out over $19 billion in leverage—the largest liquidation event ever tracked.[3] Since early October, Bitcoin has shed more than 46% of its value, entering what analysts are calling a new “Crypto Winter.”[3]
“We’re certainly in a Crypto Winter,” said Danny Nelson, research analyst at crypto asset manager Bitwise. “You can tell by how investors react to good news. (They don’t.)”[3]
U.S. spot Bitcoin ETFs have seen continued outflows, failing to provide the institutional demand needed for stabilization.[2] Crypto exchanges like Coinbase and Gemini posted weak Q4 results, while lenders such as BlockFills suspended withdrawals amid $75 million in losses.[3]
Global Markets React with Caution
The crypto slump rippled into traditional markets. U.S. futures declined: S&P 500 futures fell 0.8%, Dow Jones futures dropped 0.7%, and Nasdaq futures shed 1%.[4] Asian markets were mixed, with Hong Kong’s Hang Seng surging 2.2% while Australia’s S&P/ASX 200 lost 0.6%.[4]
Crude oil prices dipped, with U.S. benchmark falling 77 cents to $65.71 per barrel and Brent crude down 74 cents to $70.56.[4] Gold rose 1.9%, and silver climbed 5.4%, as investors sought safe havens.[4]
What Traders Are Watching Next
Market participants are eyeing tariff headlines, Federal Reserve signals, ETF flows, and on-chain metrics for stabilization cues.[1] While extreme fear levels can signal short-term bottoms, no confirmation has emerged yet.[1]
Despite regulatory acceptance from U.S. authorities and Wall Street’s growing interest, the lack of a clear catalyst—like the FTX collapse in 2022—has left many puzzled by the prolonged bear phase.[3]
As the week unfolds, traders brace for volatility. Bitcoin’s breach of $65,000 raises fears of a slide toward $60,000, but historical patterns suggest potential rebounds from oversold conditions.[1]