This article first appeared on GuruFocus.
Bitcoin (BTC-USD) slid to its lowest level in more than a week on Tuesday, slipping below $90,000 for the first time since Jan. 9 as investors continued to pull back risk across global markets. The largest cryptocurrency fell as much as 3.4% to $89,786, broadly tracking declines in equities and long-dated government bonds. Weakness extended across digital assets, with Ether dropping 6% and Solana sliding 4.6%, suggesting selling pressure was more pronounced in smaller, less liquid tokens as volatility spread.
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The move coincided with renewed stress in global bond markets after US President Donald Trump reiterated tariff threats against Europe tied to tensions over Greenland, which weighed on demand for US assets. When trading resumed after Monday's US holiday, heavy selling pushed the yield on 30-year US Treasuries up seven basis points to 4.9%. Japanese bonds also sold off sharply, with yields on 30- and 40-year securities jumping more than 25 basis points following comments from Prime Minister Sanae Takaichi pledging food tax cuts, raising concerns around looser fiscal policy and increased government spending.
While risk assets weakened, investors appeared to rotate toward defensive positions, with gold climbing to a record above $4,700. Some market participants suggest volatility could be underpriced despite the surface calm. Sean Dawson of Derive.xyz noted that options markets have turned mildly bearish, with traders paying a premium for downside protection as Bitcoin's 25-delta skew flipped to minus 3%. Others are watching whether Bitcoin could drift back toward the lower end of its recent trading range, with Caroline Mauron of Orbit Markets pointing to the $84,000 to $85,000 area as a potential support zone that previously held during tests in November.