Bitcoin experienced a dip below the $90,000 threshold on Monday, reflecting a broader investor trend of offloading growth-oriented assets, including cryptocurrencies and tech stocks. This downturn comes as the market grapples with various economic signals and shifts in investor sentiment.
The leading cryptocurrency’s price receded by almost 1%, settling at $93,737.97 at the start of the week, according to Coin Metrics data. Earlier in the session, it touched a low of $89,259.00. This price movement contributes to Bitcoin’s 9% decrease over the past week, signaling a significant shift in market dynamics.
This downward pressure isn’t isolated to Bitcoin. Ether also saw a substantial decrease, dropping by 5.7% on Monday. The wider cryptocurrency market, as tracked by the CoinDesk 20 index, fell by 3.1%. In the stock market, Coinbase shares declined by 2.9%, while MicroStrategy showed a slight increase of 0.2%. Other crypto-related stocks like Mara Holdings and Core Scientific also faced declines of 3.8% and 3.1%, respectively.
The decline in crypto asset values began the previous week, triggered by stronger-than-anticipated payroll figures. This economic data led to a surge in bond yields and coincided with growing apprehension regarding President-elect Donald Trump’s proposed tariff policies. These factors collectively strengthened the U.S. dollar, consequently exerting downward pressure on Bitcoin and other assets perceived as riskier investments.
James Davies, co-founder and CEO of the crypto trading platform Crypto Valley Exchange, commented on the market situation, stating, “The need for liquidity is caused by FX spikes because of strong end-of-year U.S. economy number, the stock market rallying strong, and there are other places money is needed in the short-term.” He further elaborated, “If we want bitcoin to act like a currency, we need to accept when it does, and this is one of those times. The U.S. Dollar has gotten stronger and everything else including bitcoin is weaker when measured in dollars.”
At the beginning of 2025, market sentiment was largely positive, anticipating a crypto-friendly Congress and White House. This optimism had previously overshadowed concerns related to macroeconomic challenges, until the market shifts observed last week.
Now, investors are expressing caution, suggesting that the first quarter of this year could present more volatility for the cryptocurrency market than initially expected. Despite Bitcoin’s impressive 120% growth in 2024, it has started the new year in negative territory, highlighting the inherent volatility and susceptibility of the crypto market to broader economic trends and investor sentiment.
