Data from CoinGecko shows that since January 29, there has been a sharp decline in the total market capitalization of cryptocurrencies. On February 3, Bitcoin reached its lowest levels since November 2024, when Donald Trump was re-elected, and his administration was perceived as more favorable to the crypto industry.
The publication notes that the sharp drop in cryptocurrency prices has led to mass liquidations in the derivatives markets, where liquidations for Bitcoin alone exceeded $2.5 billion, exacerbating the situation with quotes.
This decline has intensified doubts about whether Bitcoin can be considered "digital gold"—an asset that protects against economic instability.
On the contrary, it has demonstrated a high degree of correlation with risky assets and has undergone mass sell-offs amid deteriorating investor expectations.
Investor Michael Burry emphasized that Bitcoin continues to be primarily a speculative asset and does not serve as an effective hedging tool, unlike traditional safe-haven assets such as gold.
At the same time, major players in the crypto sphere have also faced the consequences of the decline: for example, Galaxy Digital reported significant losses for the quarter amid falling prices for digital assets.
Experts warn that in the near term, the market may remain volatile, and recovery will depend on external economic factors and the sentiments of institutional investors.
