Bitcoin’s $80,000 floor cracked under back-to-back inflation shocks, and Xi Jinping’s Taiwan warning further dampened expectations of a recovery.
BTC was trading at $79,200 in Asian hours on Thursday, down 2.3% in 24 hours and 2.2% in the seven days, after falling below the $80,000 level that had served as a floor for most of the past week, according to CoinGecko data.
Solana (SOL) led the cohort down 5.6% to $90, giving back most of the weekly gains that had made it the standout altcoin for the past two weeks. Ether fell 2.1% to $2,250 and is now down 3% on the seven days, the second weakest performer among the majors after BTC.
BNB fell 1.6% to $660, but had a weekly gain of 3.9%, while XRP fell 1.7% to $1.43. Dogecoin held in green territory at $0.1126, up 0.9% on the day, the only major in the cohort to post a 24-hour gain.
The selling pressure built around the Trump-Xi summit in Beijing, the first visit to China by a sitting US president in nearly a decade. Xi pressed Trump on Taiwan during their first meeting at the Great Hall of the People, warning of a potential “collision or even clash” if the issue is mishandled.
China’s reading of Xi’s remarks appeared to be released before the meeting had ended, putting the self-governing island in the spotlight and rattling risk sentiment globally.
Asian shares swung between gains and losses amid the friction. MSCI’s Asia Pacific index fell 0.1% after rising as much as 0.8% in early trade.
Mainland Chinese shares fell 1.3%, after hitting their highest level since 2021 ahead of the talks. The offshore yuan rose for an 11th day, its longest winning streak since September 2017, suggesting capital is starting to position itself for whatever comes out of the summit.
The crypto sell-off added to pressure from Wednesday’s producer price index pressure, which came in at 1.4% month-on-month against a 0.5% forecast and 6% year-on-year.
That followed Tuesday’s CPI reading of 3.8%, the warmest inflation pressure in nearly three years. The back-to-back inflation surprises complicate the Federal Reserve’s path to easing interest rates later this year, removing one of the structural tailwinds crypto has priced in.
Not everything broke, however. Cisco shares rose 20% in extended trading after a stronger-than-expected sales outlook, and a gauge of Asian technology shares rose as much as 2.3% to a record high. Nasdaq 100 futures rose 0.2 percent. The AI trade is still bid, although the broader risk band is getting choppy, which is the same divergence that has been running for the past three weeks.
The next test for bitcoin lies at the $78,000 level, which marked the low in early May before the rally to $82,000. A break below that would put the capitulation zone at the end of April in play. Holding the above keeps the structural buyer’s case intact heading into the next round of macro data and the back end of the Trump-Xi negotiations.
