The global cryptocurrency market capitalization now stands at $2.54 trillion, showing a decrease of 4.25% over the last 24 hours.

Several cryptocurrencies, including Bitcoin and Ethereum, continued to decline on Monday, tracking the broader market pessimism over a potential U.S. recession.

What Happened: Bitcoin slipped below the $77,000 mark to hit its lowest level in four months. The world’s leading cryptocurrency was down 29% from its all-time high, erasing almost all of the gains made since Trump’s victory in the presidential elections.

Ethereum slipped below the $1,800 level, reaching its lowest point since October 2023. Year-to-date, the second-largest cryptocurrency has plummeged more than 45%.

The downturn comes despite President Donald Trump signing an executive order for a Strategic Bitcoin Reserve last week.

Around $926 million was liquidated from the cryptocurrency market in the last 24 hours due to the slump, with $742 million in long positions being erased. However, if Bitcoin manages to recover back to the $85,000 level, it would result in the liquidation of about a billion in short positions.

Bitcoin's Open Interest decreased by 3.83% over the last 24 hours, while the number of traders positioning short on the asset rose to 52% of the total.

The Crypto Fear and Greed Index remained in the “Extreme Fear” zone on Monday morning, further indicating that traders anticipate more downsides.

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The global cryptocurrency market capitalization now stands at $2.54 trillion, showing a decrease of 4.25% over the last 24 hours.

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Stocks came crashing down on Monday. The Dow Jones Industrial Average tumbled 890 points, or 2.08%, to close at 41,911.71. The S&P 500 slipped 2.69%, ending at 5,614.56, while the tech-heavy Nasdaq Composite plunged 4% to reach a six-month low of 17,468.32.

Concerns over the U.S. economy brought down the market after Trump seemed to acknowledge the possibility of a U.S. recession in an interview over the weekend.

“We’re doing very well, but I think we could slip into a recession,” Trump said in an interview with Fox News.

The former president also made critical remarks about the U.S. central bank and its handling of interest rates.

“I think the Fed has made some very bad mistakes,” Trump said.

He added that he believed the U.S. could be in a recession already, differing from the common view among economists. Most economists surveyed by Dow Jones last week saw a one-third to two-fifths chance of a U.S. recession in the next 12 months.

“I don’t think we’re in a recession yet, but I think we could slip into one,” Trump said.

“I think we’re very close. They've made some very bad adjustments with interest rates, and they've made some very bad moves.”

Despite the gloomy outlook, Trump expressed optimism that the U.S. economy would quickly recover if a recession were to hit.

“We’ll come out of it very rapidly,” he said.

“We have a very strong economy. If we go into a recession, we’ll come out of it very rapidly.”

However, the former president’s comments come as the U.S. economy is already displaying signs of distress.

Earlier this month, data revealed that the U.S. economy contracted at a 1.0% rate in the first quarter, following a 2.6% expansion in the fourth quarter of 2023. Economists had anticipated a 0.5% growth.

Moreover, the government revised down fourth-quarter GDP to show a 0.3% contraction instead of the previously reported 0.8% growth.

Later this week, the Labor Department is set to release new data on jobless claims.

Analyst Notes: Well-known on-chain analytics firm CryptoQuant assessed whether the present market phase signaled the beginning of a bear or bull-related decline.

“In a typical bull market, people move their sats in profit, resulting in an SOPR greater than 1, unlike in a bear market. From this perspective, the bull market still seems to be in play,” the firm said, referring to the Spent Output Profit Ratio, a metric used to measure the profitability of transactions.

CryptoQuant also observed that the funding rates closely resembled the pattern seen during the 2020-21 bull market.

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