Federal Reserve Chairman speculates on cracking down on risk assets, causing Bitcoin to slide.

Bitcoin fell to a two-month low on Friday, as the market speculated that the next chair of the Federal Reserve might tighten cash in the financial system, hitting cryptocurrencies and boosting the dollar. Under Trump's leadership, cryptocurrencies were once hopeful for a golden age of fluidity and friendly regulation, but cryptocurrencies have not fared well, with the leading cryptocurrency Bitcoin losing a third of its value since hitting a historical high in October. Bitcoin fell 2.5% on Friday, closing at $82,300, continuing the previous day's decline, marking the fourth consecutive month of decline, setting the longest losing streak in eight years. Speculation that former Federal Reserve Governor Warsh will be appointed by Trump to replace Fed Chairman Powell has intensified, leading to increased selling. Warsh has called for institutional changes at central banks and hopes that, among other things, the Fed's balance sheet will be smaller. Bitcoin and other cryptocurrencies have long been viewed as beneficiaries of huge balance sheets, often rebounding as the Fed injects liquidity into the market - this is support for speculative assets. "When you start talking about pulling the carpet out from under the balance sheet... all the hedging tools that people have been flocking to--gold, cryptocurrencies, and bonds, obviously--they all start getting sold off," said Damien Boey, a portfolio strategist at Sydney-based Wilson Asset Management. Ethereum also fell to a two-month low, trading down 2.9% at $2,735.48.