Crypto slump intensifies as Ether and privacy coins lead losses

Sustained outflows from U.S. ETFs dedicated to the crypto market, combined with a decoupling from record-breaking tech stocks, have sapped investor confidence. Photo by JUSTIN TALLIS/AFP via Getty Images

Article content

Ether sank to its lowest level in over a year as digital assets continued to sustain heavy losses after a gruelling week.

Article content

The second-largest cryptocurrency fell more than 10 per cent to US$1,593 on Friday, its lowest value since April 2025. Bitcoin dropped as much as 4.9 per cent to just above US$60,438. The tokens later pared some of the losses.

Article content

Article content

Smaller cryptocurrencies fared worse, with so-called privacy coins in particular taking a pummelling. Zcash fell by more than half — its largest drop since May 2021 — over a 24-hour period after reports of a possible security flaw, while Monero declined as much as 17 per cent.

Article content

Article content

The losses extend what is already bitcoin’s longest losing streak since August, beginning after Strategy Inc. on Monday announced it had sold a small sum of the token for the first time since 2022. Sustained outflows from United States exchange-traded funds dedicated to the market, combined with a decoupling from record-breaking tech stocks, have sapped investor confidence.

Article content

Article content

Article content

“Bitcoin is fast approaching the psychological level of US$60,000,” said Caroline Mauron, co-founder of Orbit Markets. “The level proved a strong support in February and was last seen in 2024 before Trump’s election, so a clean breach is going to be damaging.”

Article content

The crypto rout comes after U.S. stocks moved toward a historic weekly run of gains, powered by the artificial-intelligence trade that has boosted technology valuations. Traders are looking ahead to U.S. employment data set to be released later on Friday, which could hold clues for the market ahead of next week’s Federal Reserve meeting.

Article content

“As global capital continues to flow toward AI and large-cap technology stocks, digital assets must compete with these high-growth sectors for investor allocation,” said Dean Chen, analyst at crypto exchange Bitunix. “However, if investors eventually begin to question the sustainability of U.S. equity valuations, the pace of capital rotation and risk repricing could unfold far more rapidly than markets currently anticipate.”

Article content

Article content

Privacy Token Rout

Article content

Privacy coins such as Zcash and Monero had been a bright spot in an otherwise dismal crypto market since the sector began a significant selloff in October. Part of the tokens’ appeal stems from how they obfuscate transaction data on blockchain networks, making it more difficult to track the flow of crypto and identify buyers and sellers.

Article content

Until Wednesday, Zcash had been up nearly 20 per cent for the year. Its collapse comes after a Gizmodo report that the project had taken emergency action on Wednesday after discovering a critical bug in its systems that would have allowed attackers to create new tokens at will.

Article content

In a blog post on Wednesday, the Zcash Foundation said it had found “no evidence of unauthorized value creation.” The foundation didn’t immediately respond to a request for further comment on Friday.

Article content

Article content

Article content