Bitcoin has lost all the progress it made earlier this year, with enthusiasm over the Trump administration’s crypto-friendly posture fading rapidly, Bloomberg reports.

The world’s largest digital asset briefly slid under $93,714 Sunday before recovering some ground to trade near $94,869 early Monday morning in Singapore.

The downturn comes just weeks after Bitcoin set a fresh record above $126,000 in early October. That rally unraveled quickly when unexpected tariff remarks from President Donald Trump rattled global markets, sending risk assets into retreat.

According to Matthew Hougan, chief investment officer at Bitwise Asset Management, broader market sentiment has shifted sharply. “Everything is turning risk-off,” he said, noting that crypto was among the first areas to reflect that shift.

Over the past month, major sources of inflows — including ETF managers and corporate treasury buyers — have quietly pulled back. Their absence has removed a key pillar of support that helped Bitcoin surge throughout the year. A slowdown in high-growth technology stocks has also weakened appetite for speculation across financial markets.

For much of 2024, institutional players helped cement Bitcoin’s image as a legitimate asset class. ETFs alone attracted more than $25 billion, boosting total assets to around $169 billion and framing Bitcoin as a hedge against inflation and political instability. But that storyline is beginning to unravel, replaced by a more concerning trend: institutional disengagement.

Jake Kennis, senior research analyst at Nansen, summarized the selloff as the result of several overlapping pressures — long-term holders taking profits, institutional outflows, macroeconomic uncertainty, and the unwinding of leveraged positions. “After months of sideways trading, the market has chosen a downward trajectory,” he said.

One notable sign of waning conviction comes from Michael Saylor’s Strategy Inc., which transformed itself into Bitcoin’s most famous corporate accumulator. Its stock is now trading almost entirely in line with the value of its Bitcoin reserves, suggesting investors are no longer willing to pay extra for its leveraged bet on the cryptocurrency.

Boom-and-bust cycles are nothing new in the digital-asset world. Bitcoin’s explosive 2017 rally — more than 13,000% — was followed by a collapse of nearly 75% the next year. Retail investors remain wary of experiencing a similar collapse, Hougan noted, which is driving many to step aside preemptively.

Bitcoin, which represents nearly 60% of the crypto market’s roughly $3.2 trillion valuation, has been volatile throughout the year. It plunged to $74,400 in April after Trump announced tariff plans, climbed back to new highs shortly after, and then was hit again by another surprise tariff announcement on Oct. 10 that triggered record liquidations.

Chris Weston of Pepperstone Group says the October selloff still looms large in traders’ minds. “The psychological damage remains,” he said, adding that many big players will need time — and sustained price recovery — before they fully reengage.

Smaller altcoins have been hit even harder. A MarketVector gauge tracking mid- and lower-tier digital assets has dropped roughly 60% this year as liquidity dries up and traders shun high-volatility tokens.

Crypto markets are no strangers to boom-bust cycles, said Chris Newhouse of Ergonia, but sentiment remains depressed. “There’s skepticism everywhere — in conversations, on Telegram, at conferences,” he said. “There aren’t any obvious catalysts to spark renewed bullishness.”