Bitcoin dropped sharply Thursday to $66,675, its weakest level since October 2024, driving a $2 trillion decline in global cryptocurrency market value from its peak, as analysts pointed to weakening risk sentiment, ETF outflows, and fears of a broader correction amid tech and precious metals selloffs.

Bitcoin fell 6.5% to $67,817, down 11% for the week and 23% year-to-date, while Ether dropped more than 7% to $1,973, posting weekly and yearly losses of nearly 14% and 34%, respectively. According to CoinGecko, the global crypto market has erased $2 trillion since topping $4.379 trillion in early October, including $800 billion in just the past month.

Massive withdrawals from U.S. spot Bitcoin ETFs have fueled the decline, with investors pulling more than $3 billion in January following $2 billion in December and $7 billion in November. Deutsche Bank analysts said the selling reflects waning interest from traditional investors and growing overall pessimism toward crypto.

The downturn also aligns with broader market pressure. Volatility in gold and silver, combined with a selloff in AI-related tech stocks, pushed the Nasdaq to multi-month lows. President Trump’s nomination of Kevin Warsh as Federal Reserve chair has raised concerns over a shrinking Fed balance sheet, removing liquidity support that previously buoyed speculative assets like crypto. “The market fears a hawk with him,” said Julius Baer strategist Manuel Villegas Franceschi.

Jefferies strategist Mohit Kumar warned that continued price drops could force liquidations among crypto miners, potentially triggering a “vicious cycle.” Coin Bureau’s Nic Puckrin described the market as being in “full capitulation mode,” signaling a months-long reset rather than a brief correction.