Bitcoin's losses intensified on Friday as investors flocked to safe havens following Trump's latest trade threats, giving one of the most popular assets in the "Trump trade" theme a reality check.

Bitcoin fell 5.8% to $79,363 at 07:00 London time, down more than 25% from its record high set less than six weeks ago. Other cryptocurrencies fell across the board, with Ethereum, Solana and XRP all falling more than 7% on Friday.

"The last time we saw market sentiment like this was in 2022," said Caroline Bowler, CEO of BTC Markets Pty Ltd, referring to the "crypto winter" when rising interest rates and industry concerns caused cryptocurrency prices to plummet. "This decline can be seen as the market reacting to Trump's macro concerns about trade and geopolitical uncertainty."

The focus on trade tensions has led to a rise in risk aversion in global markets, pushing Asian stocks almost across the board lower on Friday, and European stock futures also weakened, but cryptocurrencies fell the most.

Bitcoin has fallen more than 20% in February. If the losses hold at the close on Friday, it would be the biggest monthly drop since June 2022.

Trade war concerns

The sell-off highlights how quickly fortunes have turned for digital assets, which rose strongly after Trump won the election. Bitcoin hit an all-time high of $109,241 on Jan. 20, the day of Trump's inauguration, but has fallen since then as investors worry about the president's tough stance and broader concerns about the U.S. economy.

"It's not surprising given the macro environment," said Stefan von Haenisch, head of over-the-counter trading in Asia Pacific at cryptocurrency custodian Bitgo Inc. He said traders are still waiting for Trump to come up with specific measures on the cryptocurrency industry, such as stockpiling bitcoin.

Investors now have to consider the question of how much further Bitcoin could fall. Speaking about technical analysis, Ruslan Lienkha, head of markets at cryptocurrency platform YouHodler, said Bitcoin has support around $70,000. But he said investors shouldn't think Bitcoin's plunge will get that bad.

Lienkha said we would only see this level if negative sentiment dominated the stock market.