Headline: Crypto suffers worst week since the FTX shock — BTC down 17%, ETH plunges 22% as markets lose $390B
Crypto markets endured one of their sharpest sell-offs in years, with bitcoin and ether posting their biggest weekly drops since the November 2022 FTX collapse. Bitcoin slid about 17.3% this week and ether tumbled roughly 22%, briefly pushing BTC toward the low-$60,000s and ETH near $1,550 after a modest weekend stabilization.
Key numbers
- Bitcoin: down ~17.3% this week (near $60k).
- Ether: down ~22% this week (around $1,550).
- Market cap: roughly $390 billion wiped out in seven days; total crypto market capitalization now just above $2 trillion (less than half the October peak of ~$4.2 trillion).
- Derivatives pain: roughly $7 billion of leveraged positions liquidated during the week, about $5.7 billion of which were longs (CoinGlass).
- Most violent liquidation days: Monday and Friday.
What triggered the rout
The sell-off was driven by a mix of crypto-specific shocks and broader macro pressure:
- MicroStrategy (MSTR) sold bitcoin for the first time in nearly four years — 32 BTC (~$2.5 million). While small, the move unnerved investors who had treated the firm as a steady source of demand and raised questions about whether further sales could follow to cover other obligations tied to its preferred equity stack.
- Bitcoin ETFs continued seeing outflows. Analysts at K33 Research suggested part of those redemptions reflect a rotation of capital from crypto into artificial-intelligence–related equities, which have been rallying hard this year.
- AI tailwinds and tech IPO speculation: surging AI stocks and the prospect of high-profile IPOs (names like OpenAI, Anthropic and others) raised the “opportunity cost” of holding bitcoin for some investors, drawing capital away from crypto.
- An AI-aided security scare: Zcash (ZEC), previously a top performer this year, plunged more than 40% after researchers used Anthropic’s latest AI model to reveal a critical vulnerability in its privacy system — a reminder that AI can cut both ways for crypto.
- Macro shock: Friday’s stronger-than-expected U.S. jobs report forced investors to reassess Fed expectations. Markets that had priced in rate cuts now worry about persistent inflation and the possibility of further hikes. U.S. Treasury yields jumped and the Nasdaq 100 suffered its worst day since the tariff-driven selloff in April 2025, ending a record-setting rally that had supported risk assets.
Where things stand and what to watch
Trading stabilized over the weekend with markets closed, but sentiment remains fragile. Whether this week’s rout represents the capitulation that precedes a bottom or another leg lower will likely hinge on macroeconomic developments: bond yields, Fed policy trajectory, and whether crypto can compete for investor attention against booming AI stocks and potential tech IPOs.
For traders, the immediate takeaway is continued volatility and elevated liquidations risk. For longer-term investors, key watchpoints include ETF flows, MicroStrategy’s next moves (if any), the pace of U.S. inflation and rate guidance, and any further AI-driven security findings that could undermine confidence in specific projects.
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