Strong U.S. economy and dollar rally drive crypto sell-off, with Bitcoin and Ether leading losses.
Bitcoin Falls Below $90K
Bitcoin briefly dropped below $90,000 on Monday, hitting $89,259 before recovering slightly to $94,924. The flagship cryptocurrency is down 9% over the past week, reflecting broader declines in growth-oriented assets.
Tom Lee: Bitcoin could be significantly higher this year—$200K, maybe $250K—so I still think $90K is a good entry point.
Broader Crypto Market Decline
The crypto market faced widespread losses, with Ether down 5.7% and the CoinDesk 20 index dropping 3.1%. Crypto-related equities also saw declines, with Coinbase falling 2.9%, Mara Holdings down 3.8%, and Core Scientific retreating by 3.1%.
Stronger Dollar Adds Pressure
The decline comes as strong U.S. payroll numbers and rising bond yields boosted the dollar, pressuring Bitcoin and other risk assets. “The need for liquidity caused by FX spikes and a stronger dollar has made Bitcoin weaker,” said James Davies, CEO of Crypto Valley Exchange.
Optimism Turns to Uncertainty
The crypto market entered 2025 with optimism surrounding a pro-crypto U.S. Congress and White House. However, macroeconomic concerns have dampened sentiment, with investors now bracing for a potentially turbulent first quarter.
Historical Context
Bitcoin experienced a 120% price increase in 2024 but has started the new year on a negative note. Analysts caution that short-term volatility could challenge crypto investors.
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