Bitcoin and ether fell sharply on Friday, reaching multi-month lows, as investors retreated from riskier assets amid concerns over lofty tech valuations and fading expectations of near-term U.S. interest rate cuts.

The decline underscores the fragility of sentiment across global financial markets.

Crypto markets under pressure

Bitcoin dropped 5.5% to $81,668, its lowest level in seven months.
Ether slid over 6% to $2,661.37, a four-month low.
Both tokens are down roughly 12% this week.

Analysts say the slide reflects a broader flight from risk, with high-flying AI stocks tumbling and market volatility surging.

About $1.2 trillion has been wiped off the total market value of cryptocurrencies in the past six weeks, according to CoinGecko.

Hong Kong-listed bitcoin ETFs from China AMC, Harvest, and Bosera fell nearly 7% each on Friday, reflecting the global impact of the selloff.

Bitcoin’s rollercoaster year

After reaching a record high above $120,000 in October, Bitcoin has now erased all its year-to-date gains and is down 12% for the year. Ether has lost nearly 19%.

Tony Sycamore, a market analyst at IG, said:

“If it’s telling a story about risk sentiment as a whole, then things could start to get really, really ugly, and that’s the concern now.”

Citi analyst Alex Saunders noted that $80,000 is a key level, representing the average Bitcoin holding in ETFs.

Impact on crypto stocks

The selloff has also hit companies holding crypto on their balance sheets:

Strategy (MSTR.O) fell 11% this week, nearing one-year lows.
Metaplanet has tumbled roughly 80% from its June peak.
Coinbase dropped 1.9%, on track for its longest losing streak in over a month.
Crypto miners MARA Holdings and CleanSpark declined 2.4% and 3.6%, respectively.
Gemini, the Winklevoss twins’ recently listed exchange, plunged 62% from its listing price.

CryptoQuant reported that Bitcoin market conditions are the most bearish since the bull cycle started in January 2023, suggesting that the current cycle’s demand wave may have passed.

The recent selloff highlights investor caution amid volatile markets and signals that cryptocurrencies remain highly sensitive to broader financial trends. Analysts warn that if risk sentiment continues to deteriorate, further declines across crypto assets and related stocks are likely.