Key Takeaways

• Why is Bitcoin dropping: Bitcoin dropped to around $65,800 as Trump’s tariff shock rattled global markets in early April 2026.
• Over $514 million in leveraged positions were liquidated in a single 24-hour window, accelerating the drop.
• Arthur Hayes warns of a potential dip below $60,000 before any meaningful rally toward $250,000 begins.

Bitcoin has been sliding, and investors want real answers. The price dropped to around $65,800 recently, while the S&P 500 shed roughly 10% in just two days. Several forces hit at the same time, and together they pushed prices lower fast. Here are the five main reasons behind the current Bitcoin selloff.

How Did Trump’s Tariff Shock Trigger the Drop?

The biggest catalyst behind the current drop is what markets are calling “Liberation Day.” President Trump’s sweeping tariff announcements rattled global markets hard. Investors pulled money out of risk assets almost immediately, and Bitcoin was not spared.

What’s notable is that Bitcoin actually held above $66,000 with more composure than stocks. But holding above a level and rallying are two different things. Sentiment turned negative fast, and that kept buyers on the sidelines.

Arthur Hayes, co-founder of BitMEX and CIO of Maelstrom, said he would not invest his last dollar into Bitcoin right now. His reasoning centers on one thing: the Federal Reserve has not yet been forced to expand liquidity. Hayes believes tariffs drive goods inflation and anger voters, which will eventually push the U.S. toward capital controls. Those controls, he argues, will ultimately act as massive liquidity catalysts for Bitcoin. But the “wait for the printer” moment has not arrived yet.

Why Did Mass Liquidations Make the Drop Worse?

Leveraged trading turned a moderate pullback into a sharper one. According to Coinglass data, about 130,380 traders got liquidated within a single 24-hour window. Total liquidations hit approximately $514.72 million.

The damage was heavily one-sided:

• Long liquidations: $34.04 million wiped out as bullish bets collapsed.
• Short liquidations: Only $394,180 by comparison.

This imbalance tells a clear story. Traders were positioned for upside, and the drop caught most of them off guard. When long positions get liquidated automatically, exchanges sell the underlying BTC to cover the margin. That selling adds more downward pressure on price. Each liquidation triggered more, and the drop compounded quickly.

Exchanges like Bybit, BingX, and KuCoin publish live liquidation data. Watching those levels before entering a trade gives you a clearer picture of where price could move violently.

How Did Crypto-Linked Stocks React to the Bitcoin Drop?

Bitcoin’s drop pulled down the entire ecosystem of crypto-adjacent stocks. Within 24 hours of Bitcoin falling to $65,800, the following happened:

• Coinbase (COIN) fell roughly 6% to $162.92, with its RSI near 12, deep in oversold territory.
• MicroStrategy (MSTR) dropped about 5% to $126.49, breaking below its key support level near $128.
• MARA Holdings (MARA) slid nearly 7.34% to $7.95 on heavy selling pressure.
• Riot Platforms (RIOT) fell close to 7% to $13.05, breaking down from the $14 zone.
• Robinhood (HOOD) dropped about 5% to $67.27, with an RSI around 22 signaling oversold conditions.

RSI readings this low across the board signal extreme selling pressure. A short-term bounce is technically possible. However, the broader trend structure still favors weakness unless Bitcoin reclaims the $68,500 zone with conviction.

You can track these movements and spot early recovery signals using crypto analytics platforms that combine on-chain data with price action.

What Role Did Sentiment and Fear Play?

The Crypto Fear and Greed Index sat in “Extreme Fear” territory for weeks heading into this drop, with readings near single digits. That kind of sustained fear reflects one thing: sellers are in control and buyers are waiting.

Retail investors tend to react to headlines rather than data. Negative news spreads fast on social media, and fear moves quicker than facts. By the time most people read about the drop, it had already gotten worse.

Technical signals were also flashing red before the bottom fell out. Bitcoin had already broken below the $96,000 level in the weeks prior. The RSI around 20 at current levels reflects deeply oversold conditions. That said, oversold does not automatically mean the bottom is in. Bitcoin could still test the $64,000 support level before any recovery takes shape.

Hayes himself flagged another emerging risk: AI-driven job displacement. He argued that rapid advances in artificial intelligence could trigger a severe deflationary credit crisis, temporarily dragging down all risk assets, Bitcoin included. Separately, leaked reports about advanced AI models raised concerns about new systemic vulnerabilities, adding another layer of uncertainty to already fragile sentiment.

Is Institutional Behavior a Factor in the Selloff?

Institutions move differently than retail. They reduce exposure quickly when macro conditions deteriorate, and they do it before headlines break. That’s part of why the drop happened as fast as it did.

That said, institutional infrastructure is still expanding. Charles Schwab, which manages nearly $12 trillion in client assets, confirmed it will launch direct spot Bitcoin and Ethereum trading through a new “Schwab Crypto” account in the first half of 2026. That puts crypto inside the same platform millions of retail investors already use for stocks and bonds.

Robinhood CEO Vlad Tenev also made waves this week, calling market closing times a “legacy design choice” and pointing to tokenization as the path toward a more open financial system. These are not the words of institutions pulling away from crypto. They are building toward it.

The tension right now sits between expanding institutional infrastructure and a deteriorating short-term macro setup. Hayes’ long-term target of $250,000 to $750,000 for Bitcoin remains intact, but his short-term warning of a drop below $60,000 is the more immediate concern for traders.

Research from Mercado Bitcoin adds some historical context. After major global shocks, including previous tariff escalations and the COVID-19 outbreak, Bitcoin consistently outperformed both gold and the S&P 500 in the 60 days that followed. Bitcoin typically drops first as investors scramble for cash, then bounces back harder than traditional assets. The current pattern appears to be following that same playbook.

For anyone holding Bitcoin through this period, a hardware wallet like Ledger or Trezor keeps your holdings secure while you wait out the volatility. You can also review crypto wallet options to find the right setup for your situation.

Frequently Asked Questions

Is the current Bitcoin drop different from previous selloffs?

The mechanics are familiar: macro shock, leveraged liquidations, and fear-driven selling. What stands out this time is that Bitcoin held up better than equities during the initial tariff shock, which caught even skeptics off guard.

Could Bitcoin drop below $60,000 from here?

Arthur Hayes warned publicly that a prolonged U.S.-Iran conflict or continued macro deterioration could push Bitcoin below $60,000 before any sustained rally. Bearish chartists point to a potential bottom in the $51,000 to $53,000 range.

Should you buy Bitcoin during this drop?

That depends entirely on your risk tolerance and time horizon. Dollar-cost averaging is a common approach during volatile periods. Buying on Coinbase or Kraken lets you spread entries rather than going all in at once.

Where can you track Bitcoin’s price and market data in real time?

Use on-chain analytics tools alongside exchange dashboards on platforms like Gemini and Crypto.com. Pair those with crypto research platforms to get a fuller picture beyond just price.