Bitcoin (BTC-USD) tumbled below $71,000 per token on Thursday after Treasury Secretary Scott Bessent suggested the US government would not bail out the cryptocurrency.
In a heated back-and-forth during a House Financial Services Committee on Wednesday, Bessent was asked if the US Treasury had the authority to buy bitcoin or other cryptos.
"I do not have the authority to do that, and as chair of FSOC, I do not have that authority," Bessent stated.
Bessent's comments pushed bitcoin spiraling lower on Wednesday, extending a slump from earlier in that session. But the leading cryptocurrency was paring losses on Thursday after it approached the key $70,000 level.
The decline was also fueled by the broader selling pressure in markets and a warning from notable investor Michael Burry that a sustained decline in bitcoin's price could "set in motion a death spiral leading to massive value destruction."
"Bitcoin has been exposed as a purely speculative asset, and is not near the debasement trade hedge that gold and other precious metals are," Burry, who rose to prominence after predicting the 2008 financial crisis, wrote in his Substack.
The move lower on Thursday only added to bitcoin's recent rout. The world's largest cryptocurrency is down 18% year-to-date.
Bitcoin dropped sharply last weekend to notch its fourth straight month of losses.
The move lower coincided with President Trump's announcement last Friday selecting Kevin Warsh to lead the Federal Reserve when Jerome Powell's term ends in May, a nomination markets view as hawkish.
Ether (ETH-USD) and other digital tokens also slid.
Given bitcoin broke through the key support level at $73,000, "current flows suggest sentiment has shifted meaningfully," 10X Research strategists wrote in a recent note.
The firm's strategists pointed to flow and positioning data, which indicated "investors are not yet positioned to buy the dip."
"While sentiment and technical indicators are approaching extreme levels, the broader downtrend remains intact," the researchers wrote. "In the absence of a clear catalyst, there is little urgency to step in."
The firm noted that traders remain focused on deleveraging and unwinding their positions rather than on preparing for a typical snapback rally.
Pressure on digital assets reflected the broader fragility across the crypto market. Aside from a brief bounce last month, bitcoin has struggled since October, when whale selling and forced liquidations swept through the industry.
Fundstrat head of digital assets Sean Farrell said the mid-$70,000 region stands out as a logical support zone, given that around $74,000 was the intraday high in March 2024 and the intraday low in April 2025 during the tariff-driven sell-off.
"All else equal, the levels reached over the weekend and the degree of capitulation observed create a more attractive near-term risk/reward," Farrell wrote in a Monday note.
The strategist said the pullback could warrant a "modest" deployment of dry powder but warned that conditions are still trending lower, with an "ample amount of positioning risk in traditional markets that could adversely affect crypto markets."