Crypto investors endured one of their toughest weeks in years as a wave of selling wiped out hundreds of billions of dollars from digital asset markets. Bitcoin fell 17.3% this week while ether dropped 22%, putting both on track for their worst weekly decline since November 2022, when the collapse of FTX triggered a market-wide panic. Despite a modest stabilization on Saturday, BTC traded just above $60,000 and ETH around $1,550.
The damage extended beyond the two largest coins. According to TradingView, the digital asset market shed roughly $390 billion in value during the week, leaving total market cap hovering just above $2 trillion — less than half the nearly $4.2 trillion peak hit in October.
Leverage Longs Wiped Out: $7 Billion in Liquidations
Crypto derivatives traders suffered one of the largest wipeouts of the year. CoinGlass data shows about $7 billion in leveraged positions were liquidated across digital assets, with Monday and Friday delivering the most severe flushes. Roughly $5.7 billion of those were long positions, or bullish bets on higher prices.
Multiple Bearish Forces Converge
The selloff came as several factors hit simultaneously. On Monday, Strategy (MSTR), the largest corporate bitcoin holder, disclosed it sold BTC for the first time in nearly four years. The transaction was negligible — just 32 BTC worth roughly $2.5 million — but it rattled investors who had long viewed Michael Saylor’s company as a perpetual source of demand. Speculation also grew that Strategy might need to sell more BTC to cover obligations tied to its growing preferred equity stack.
Meanwhile, bitcoin ETFs continued to bleed assets. K33 Research head Vetle Lunde argued earlier this week that some outflows reflected a broader rotation of capital away from crypto into AI investments. With AI-related stocks pushing to record highs and potential IPOs from OpenAI, Anthropic and SpaceX on the horizon, “the opportunity cost of holding BTC” has become increasingly difficult for some investors to ignore, Lunde said.
Concerns about AI’s ability to expose flaws in crypto protocols also added to the pressure. Zcash (ZEC), one of the best-performing cryptos earlier this year, tumbled more than 40% after researchers used Anthropic’s latest AI model to uncover a critical vulnerability in the network’s privacy system.