A period of unusual calm (not enough evidence to call it a crypto winter yet) in cryptocurrency markets came to an abrupt end last Monday, as the prospect of rising long-term interest rates in the U.S. sparked a sell-off in alternative assets like Bitcoin, leading to a massive unwinding of bullish bets. Rumors abound that Elon Musk poured oil into the fire by selling Bitcoin owned by his SpaceX to the tune of $373 million, according to the Wall Street Journal.

Sadly, SpaceX, which first purchased BTC in 2021, kept writing down the value of its Bitcoin holdings in 2021 and 2022 which finally resulted in liquidation of its entire position in crypto.

In history is of any indication, the previous write-down unambiguously coincided with a sudden steep drop in BTC price, which crashed in late 2021, setting off a "crypto winter" that extended through most of 2022.

Last week’s epic plunge took Bitcoin from nearly $29,000 to $25,314 in 24 hours. According to Coinglass, the sell-off unwound positions worth more than $1 billion. The most capitalized cryptocurrency is down 0.14% today as of 10:30 a.m. CET at $26,074.

Bitcoin is still about 60% above its level at the start of the year, significantly outperforming other well-performing assets such as technology stocks. But a variety of headwinds — from rising bond yields to regulatory pressure to a weakening Chinese economy — could potentially aggravate performance of cryptocurrencies down the road this year.