Bitcoin has given up its gains in 2026, falling about 4% in the past 24 hours to about $88,850 as of Wednesday morning Asian time.
The current price is roughly the same as its closing price in 2025, erasing a three-week rally that briefly pushed the cryptocurrency above $97,000. At the time of writing, the token is attempting a rebound after hitting a session low of $87,901.
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A disappointing end to 2025
Bitcoin ended 2025 at around $87,000 to $88,000, down about 30% from its all-time high of $126,000 in October, and a loss of about 6% for the year. December was particularly tough, with cryptocurrencies falling by around 22%, their worst monthly performance since December 2018.
The long-awaited “Santa Rally” did not materialize. Thin holiday liquidity and lack of new catalysts left markets adrift in year-end trading. Repeated attempts to recover key resistance levels have been met with selling pressure.
New Year’s Rebound: Hopes for Inflation Easing and Regulation
Sentiment changed dramatically in early 2026. On January 14th, the Bureau of Labor Statistics released an inflation report showing that prices were stable, and Bitcoin rose more than 4% in 24 hours, topping $97,000, a level not seen since mid-November.
The breakout of the $95,000 level, which is an important zone both technically and psychologically, hinted at the possibility of further upside. Optimism surrounding the Clarity Act, which establishes a broad regulatory framework for digital assets, also supported sentiment. However, the Senate delayed the bill’s planned increase to the last week of January, indicating it did not yet have the necessary votes.
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geopolitical risk return
On January 21, President Donald Trump’s push to acquire Greenland and threat of new tariffs against European allies shocked global markets. Benchmark U.S. stock indexes fell more than 2%, the VIX index hit its highest level since November and the dollar weakened against most major currencies.
The situation “creates a tail risk that people don’t want U.S. assets,” Shiyan Cao of hedge fund Winshore Capital told Bloomberg, adding that investors now have to factor in a political risk premium.
The decline reflected concerns from April 2025, when President Trump’s wide-ranging tariff announcements caused a severe downturn and significant volatility in U.S. markets.
Outlook: Volatility will continue
Bitcoin has now completed a full circle, erasing its year-to-date gains and returning to its 2025 closing price level. Further volatility is expected on Wednesday, when the Supreme Court hears arguments against Mr. Trump in his bid to fire Federal Reserve Governor Lisa Cook.
An agreement could eventually ease tensions in Greenland, but it could take months, during which time markets will face increased volatility.
For now, the cryptocurrency appears to be holding steady above $88,000, with traders assessing whether this is a buying opportunity or the beginning of another correction.
