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Highlights
Bitcoin (LON:BTC) continued its downward trajectory on Tuesday, falling 2.6% to $96,870 as a broader crypto rout ensued. This slide follows Bitcoin’s recent surge above the $100,000 mark, which had triggered profit-taking among traders. The pullback was further fueled by weakening global risk appetite, stemming from increased geopolitical tensions, particularly in the Middle East, and mounting uncertainty surrounding U.S. interest rates.
The latest dip in Bitcoin’s price reflects broader market sentiment, with traders reacting to developments that have unsettled risk assets across the board. The shift in sentiment comes as markets await further clarity on U.S. policy under President-elect Donald Trump, particularly his stance on crypto regulation. Despite early optimism following the nomination of pro-crypto candidates for key positions, concerns linger about how much tangible support the incoming administration will provide for the crypto sector.
Beyond policy uncertainty, a major development influencing crypto prices was the announcement of a breakthrough in quantum computing by Google (NASDAQ:GOOGL). The tech giant revealed a next-generation chip capable of solving extremely complex problems, raising alarms within the crypto community. As quantum computing continues to advance, it could pose a significant threat to the cryptographic security that underpins digital currencies. A study by Deloitte highlighted that a potential quantum attack could expose approximately $40 billion worth of Bitcoin to vulnerabilities.
The decline in Bitcoin's value was mirrored by steep losses in other cryptocurrencies. Ethereum (LON:ETH), the second-largest crypto by market capitalization, fell 6.1% to $3,702.02, while XRP (LON:XRP) experienced a near 13% drop to $2.1672. Other notable altcoins such as Solana, Cardano, and Polygon saw losses ranging from 7% to 16%, while meme token Dogecoin (DOGE) slumped by 10%.
As Bitcoin and other major cryptocurrencies continue to face a challenging market environment, investors remain cautious, navigating the complex landscape of regulatory uncertainties, geopolitical risks, and technological threats.
