Bitcoin Falls Below $90,000 as Global Market Selloff Intensifies

Bloomberg -- Bitcoin has experienced a significant decline, dropping to its lowest point in over a week, in tandem with a global selloff across financial markets as investors continue to mitigate risks amidst ongoing geopolitical uncertainties. The leading cryptocurrency dipped below the $90,000 mark for the first time since January 9, mirroring declines in equities, long-dated Treasuries, and Japanese bonds while volatility surged in debt markets. Following a decline of up to 4% on Tuesday, Bitcoin continued its downward trend on Wednesday morning in Asia, decreasing by 0.5% to $88,894 as of 9:27 a.m. in Singapore. Karim Dandashy, a trader at crypto trading firm Flowdesk, noted that the $90,000 threshold has served as a crucial support level thus far this year and may represent a significant inflection point in the near term. Smaller, less liquid tokens suffered even heavier losses, with Ether falling more than 7% and Solana dropping 5.3%. Shares in cryptocurrency-related stocks also took a hit; Coinbase Global Inc. decreased by 5.6%, while Bitcoin accumulators, Strategy Inc., saw a drop of nearly 8%. The downturn in financial markets was prompted by President Donald Trump's remarks threatening to disrupt the postwar order and asserting U.S. dominance over the Western hemisphere, raising concerns about transatlantic alliances amid plans to take control of Greenland. Japanese bonds also experienced a decline, fueled by worries over the country's fiscal situation. Shiliang Tang, managing partner of Monarq Asset Management, commented that Bitcoin's recent sharp fall reflects a broader trend of capital fleeing risk assets in response to the U.S. administration's tariff threats on European countries and geopolitical tensions related to Greenland. This sentiment is further illustrated by the rally of gold and silver, alongside a weakened dollar. Additionally, Japanese bonds saw yields on 30- and 40-year securities spike by over 25 basis points following promises from Prime Minister Sanae Takaichi for tax cuts on food during her election campaign, which raised concerns about increased government spending and lax fiscal policies. On a different note, Michael Saylor's Strategy announced the purchase of approximately $2.13 billion in Bitcoin over eight days, marking its largest acquisition since July. Jake Ostrovskis, head of over-the-counter trading at Wintermute, stated that this substantial purchase indicates a continued appetite for Bitcoin exposure among retail and institutional investors through equity wrappers, with Bitcoin currently outperforming Ether in light of this news. So far this year, crypto investors have channeled around $1.2 billion into the approximately dozen U.S.-listed Bitcoin ETFs, which had initially bolstered the token's price following last year’s market downturn.