{"id":133144,"date":"2026-02-06T14:27:37","date_gmt":"2026-02-06T14:27:37","guid":{"rendered":"https:\/\/mycryptomania.com\/?p=133144"},"modified":"2026-02-06T14:27:37","modified_gmt":"2026-02-06T14:27:37","slug":"bitcoin-price-crash-is-it-all-donald-trumps-fault","status":"publish","type":"post","link":"https:\/\/mycryptomania.com\/?p=133144","title":{"rendered":"Bitcoin Price Crash \u2013 Is it All Donald Trump\u2019s Fault?"},"content":{"rendered":"

The Bitcoin price bounced emphatically off support at $60,000 in the first strong signal of bottoming activity, after giving up all of its Trump rally gains \u2013 but is it Trumpism in crypto that is at the root of crypto\u2019s ills?<\/p>\n

There\u2019s certainly more hope in the air as the European session opens this morning, with Bitcoin trading above $66,400.<\/p>\n

But all the factors that created the crash are still very much in play. Crypto leverage<\/a>, crowded tech trades, high-risk asset correlation and Bitcoin narrative doubts are all in the bear market mix.<\/p>\n

Fire up your Bloomberg terminal and create a chart to show the correlation between Bitcoin (XBT\/USD), The Magnificent 7, tech stocks (BM7T) and the Bloomberg AI Value Chain Total Return Index (BAIVT) and you will see the following (thanks to Kathleen Brooks, research director at brokerage XTB):<\/p>\n\n

Brooks explains what\u2019s going on here: \u201cThe sell-off in bitcoin is also interesting, as bitcoin and the Nasdaq tend to move together, and their positive correlation is 40%. This is a moderate positive correlation, however, the correlation between bitcoin and Bloomberg\u2019s basket of AI stocks have a closer positive relationship, at 62%.<\/p>\n

\u201cThis suggests that when Bitcoin moves, it has an impact on AI stocks<\/a>. The reason for this is liquidity. In recent years, liquidity has flowed across digital assets and advanced tech stocks at the same time. This means that both asset classes share a tight financial link, which is impacted by shifts in liquidity patterns.<\/p>\n

\u201cSo, when bitcoin gained strength, this flowed into AI stocks, and when the price of bitcoin falls, this downside pressure can weigh on tech stocks.\u201d<\/p>\n

But what about the Trump factor? I asked Brooks for her take: \u201cI think that the Trump family\u2019s crypto interests are grubby, but I don\u2019t think that is the main reason for investors deserting crypto in recent months.<\/p>\n

Billionaire GOP Donor Ken Griffin Criticizes Trump Administration For \u2018Enriching\u2019 Family Membershttps:\/\/t.co\/04YcnBglX5<\/a> pic.twitter.com\/xbz9zrRJAR<\/a><\/p>\n

\u2014 Forbes (@Forbes) February 4, 2026<\/a><\/p>\n\n

\u201cI think Trump\u2019s policies, his threats to take Greenland by force, ditching his allies, and threatening Fed independence are actually hurting the environment for crypto.<\/p>\n

\u201cCrypto still has very limited uses, so when the geopolitical outlook\/order is upended by a US President with an America First agenda, this makes it even less attractive to hold.\u201d<\/p>\n

Brook then turned to what she sees as the technical factors at play: \u201cIn the past few months, investors have been very wary of assets that have reached record highs, crypto was the first asset where valuations looked stretched and investors sold their stakes, wth few buyers to pick up the dip.<\/p>\n

\u201cThis is happening with silver now and to a lesser extent with gold. Thus, the sell-off in crypto is part of a market-wide event with traders and investors reassessing valuations and how much risk they are willing to hold in richly valued assets.\u201d<\/p>\n

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