Bitcoin drops below $90K to lowest level since November amid macroeconomic pressures

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Bitcoins Bitcoin briefly dipped to $89,500 as rising bond yields and strong US economic data heightened uncertainty in crypto markets.

Bitcoin fell to $89,500 early Monday, reaching its lowest point since November 18, 2024, as macroeconomic factors and rising bond yields weighed on crypto markets.

The leading digital asset later recovered to $92,000, but the broader crypto market remained under pressure.

According to CoinGecko data, Ethereum dropped 8%, Solana declined 6.5%, and Dogecoin fell 5%, with smaller tokens seeing double-digit losses. The total crypto market capitalization decreased by 6% over the past 24 hours.

The sell-off followed strong US jobs data released Friday, which led traders to reduce expectations for Federal Reserve rate cuts.

According to the CME FedWatch tool, interest rate traders largely expect the Federal Funds rate to remain steady at 4.25% to 4.5% throughout most of the year.

Expectations for rate cuts begin to surface in later months—September, October, and December—with probabilities for a 25 basis-point reduction remaining below 42% for each of the final three Federal Open Market Committee meetings of 2025.

US Treasury yields stayed elevated, with the 10-year yield at 4.78%, while the Dollar Index surpassed 110, reaching levels not seen since 2022.

“Sticky inflation, robust economic data, and the Federal Reserve’s cautious approach to interest rate cuts have curbed liquidity,” said James Toledano, Chief Operating Officer at Unity Wallet. “This limits appetite for speculative assets like Bitcoin and creates short-term volatility.”

The price decline triggered $730 million in total crypto liquidations over the past day. Data from Coinglass revealed $617 million in long positions were liquidated, while short liquidations totaled $112 million.

Bitcoin’s market dominance climbed to 58.5% amid the recent market turbulence. This has potentially delayed the long-awaited alt season.

Many traders had anticipated that the alt season would materialize in the year following Bitcoin’s halving. However, this alt season may have been a brief one.

A mini alt season appeared to emerge after Trump was elected president in November, potentially creating a short-lived rally that lasted less than two months, culminating just days before Christmas.

The initial optimism surrounding US Bitcoin ETF launches and pro-crypto statements by President-elect Donald Trump has waned. Inflation concerns and stronger-than-expected US economic data have added to the dampened sentiment.

Toledano explained that if Trump’s policies meet market expectations, the bull run could pick up again.

However, any disappointments or unexpected events might lead to prolonged consolidation or even further corrections.