MW Bitcoin sinks below $90K as large investors sell their holdings and haven seekers go elsewhere
By Gordon Gottsegen
Investors don't seem to have much appetite for bitcoin's volatility right now
Bitcoin slipped back below $90,000 this week as global market volatility caused investors to step away from the cryptocurrency
After a brief rally last week, bitcoin was back below $90,000 Thursday.
It's been a volatile week for global markets. President Donald Trump threatened new tariffs on several European countries, then backed off days later, causing stocks to whipsaw. Japanese bonds BX:TMBMKJP-10Y were selling off, and U.S. Treasury yields BX:TMUBMUSD10Y were moving higher. All of this pointed to a "risk-off" sentiment taking over among investors, and that meant there wasn't much appetite for bitcoin.
"In short, a geopolitical roller coaster and surging Japanese government bond yields across the curve are likely the major factors driving the recent cryptocurrency downturn," Samer Hasn, senior market analyst at XS.com, told MarketWatch.
"The situation in Greenland, which evolved into a tariff threat, combined with anticipation surrounding the Bank of Japan's monetary-policy decision, has put leveraged traders on edge," he said. "This has made any attempted bullish moves feel increasingly risky."
Hasn also pointed to tightening market liquidity, along with volatile markets, as a bad mix for bitcoin (BTCUSD). He noted that U.S. spot bitcoin exchange-traded funds saw nearly $500 million in outflows over the course of two trading days as institutional investors sold off some of their holdings. He also called out that more than $700 million worth of liquidations were wiped out from bitcoin futures since Monday.
Read: Bitcoin's rally wasn't enough to push it past $100K this week. Here's what it needs to get out of this rut.
This is a reversal from last week, when institutional buying in spot bitcoin ETFs drove the price of the cryptocurrency higher. However, that demand unwound this week.
"Bitcoin's slide below $90,000 this week, which was accelerated by over $1 billion in liquidations, was less a fundamental break than a mechanical unwind of leverage built on expectations of a move up to $100,000," Wenny Cai, chief operating officer of SynFutures, wrote in an email.
Because bitcoin couldn't maintain its upward momentum, those leveraged bets fell short and investors had to exit their positions. Cai also pointed out that bitcoin faces regulatory headwinds, too, with the Digital Asset Market Clarity Act currently stalled in the U.S. Senate. This has slowed the willingness of institutional investors to add more of the crypto into their portfolios.
Ultimately, institutional investors still see bitcoin as a risk asset, so the fact that they seem to be stepping away from it during times of market volatility is in line with that assessment. While early crypto adopters may tout bitcoin as "digital gold," that designation doesn't seem to hold when markets churn and investors look for safe havens.
"I believe the narrative of bitcoin as 'digital gold' or a safe haven against dollar debasement is overestimated. This comparison is perhaps only accurate within the cryptocurrency ecosystem, where bitcoin's market dominance typically rises as altcoins collapse," Hasn told MarketWatch. "When the broader market shifts into a risk-aversion mood, cryptocurrencies generally decline."
Gold (GC00) and silver (SI00) have been setting a series of record highs this week, with investors turning to metals for safety and diversification, but also for their industrial uses.
-Gordon Gottsegen
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(END) Dow Jones Newswires
January 22, 2026 11:39 ET (16:39 GMT)
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