Bitcoin staged a modest rebound from a 16-month low during Asian trading on Friday, but remained on course for a steep weekly loss as risk-off sentiment and uncertainty around U.S. monetary policy continued to pressure cryptocurrency markets.
The recovery came after sharp losses earlier in the week, although overall sentiment stayed fragile following a disappointing earnings report from Strategy Inc., the largest corporate holder of Bitcoin, which posted a significantly wider fourth-quarter loss.
Bitcoin rose 6.5% to $66,829 by 09:20 ET (14:20 GMT), rebounding from a 16-month low of $60,187. Despite the bounce, the world’s largest cryptocurrency has now fallen more than 50% from its record high reached in October and has erased all gains made since Donald Trump’s election victory in late 2024.
Bitcoin heads for third straight weekly loss
Bitcoin was on track for a third consecutive weekly decline, down nearly 13% for the week. The selloff has been driven by a broad retreat from speculative assets, which intensified after Trump nominated Kevin Warsh as his pick for the next Federal Reserve chair.
Warsh is widely viewed as a less dovish candidate, particularly given his opposition to the Federal Reserve’s asset-buying programs. Markets fear this could translate into a tighter long-term monetary stance, weighing on high-risk assets such as cryptocurrencies.
Risk aversion also deepened alongside a prolonged downturn in U.S. technology stocks, which Bitcoin has increasingly mirrored during periods of market stress.
“Price action remained closely correlated with high-beta equities as broader risk-off conditions persisted,” said Dessislava Ianeva, analyst at Nexo. “During risk-off phases, investors typically rotate toward safer and more liquid assets such as U.S. Treasuries, cash, and defensive equities.”
Strategy posts massive Q4 loss amid Bitcoin weakness
Strategy Inc. reported a fourth-quarter loss of $12.4 billion on Thursday, sharply wider than the $670.8 million loss recorded a year earlier. The result was driven largely by the prolonged decline in Bitcoin prices since October.
The company currently holds 713,502 Bitcoins as of February 1, acquired at an average cost of $76,052 per coin, or roughly $54.26 billion in total. With Bitcoin now trading well below that average, investor concerns have grown that Strategy could be forced to sell some of its holdings to meet debt obligations.
Strategy has financed its Bitcoin accumulation through a combination of debt issuance and equity offerings, amplifying market sensitivity to further declines in crypto prices.
Altcoins recover but remain deeply in the red
Broader cryptocurrency prices followed Bitcoin’s rebound on Friday but continued to post sizable weekly losses.
Ethereum rose 6.5% to $1,941.3, though it remained down roughly 15% for the week. XRP and BNB gained 18% and 5.6%, respectively, but were still nursing double-digit weekly declines.
Solana was headed for an 18% weekly loss, while Cardano fell 7.5%. Among meme tokens, Dogecoin was down about 10% for the week, and $TRUMP had slid nearly 18%.
