Bitcoin has lost its gains from 2026, dropping about 4% in the past 24 hours, and is currently around $88,850 during the Asian hours on Wednesday morning.
The price is currently at nearly the same level as the closing price for 2025, having briefly surpassed $97,000 during a rally that lasted three weeks, but has since erased those gains. At the time of writing, this token is attempting to rebound after touching a session low of $87,901.
The end of 2025 is disappointing.
Bitcoin's closing price for 2025 is expected to be around $87,000 to $88,000, reflecting a decline of about 30% from the October all-time high of $126,000, resulting in an annual loss of approximately 6%. December, in particular, has been tough, with this cryptocurrency dropping 22% and recording its worst monthly performance since December 2018.
The expected "Santa Rally" did not materialize. The market lost direction heading into the last trading sessions of the year due to low liquidity during the holiday season and a lack of new catalysts.
New Year rebound: Expectations for inflation easing and regulatory relaxation.
In early 2026, sentiment dramatically shifted. On January 14, the inflation report released by the U.S. Bureau of Labor Statistics indicated price stabilization, causing Bitcoin to rise over 4% in 24 hours and surpass $97,000 for the first time since mid-November of last year.
Breaking above $95,000 was seen as a significant level from both technical and psychological perspectives, raising awareness of potential upward movement. Expectations for the Clarity Bill, which aims to establish a comprehensive legal framework for digital assets, also supported sentiment. However, the Senate postponed the markup of the bill to the last week of January, indicating that the necessary votes have not yet been secured.
Geopolitical risks have resurfaced.
On January 21, U.S. President Trump pushed for the acquisition of Greenland and hinted at new tariffs on European allies, shocking global financial markets. Major U.S. stock indices fell by over 2%, the VIX reached a high level not seen since November, and the dollar declined against major currencies.
Shiyan Zhao of Winshore Capital told Bloomberg, "A tail risk has emerged that makes U.S. assets less attractive," pointing out that investors need to factor in political risk premiums.
This selling pressure recalled the anxiety experienced in April 2025 when President Trump announced significant tariffs, causing a sharp drop in U.S. markets and a surge in volatility.
Outlook: High volatility continues.
Bitcoin has rounded here, losing all gains since the beginning of the year and returning to the closing level of 2025. On Wednesday, the Supreme Court is scheduled to hear the case regarding President Trump's demand for the dismissal of Federal Reserve Governor Lisa Cook, raising concerns about increased market volatility.
While an agreement on the Greenland issue could ultimately ease tensions, it is expected to take several months, and instability in the market is likely to continue in the meantime.
At this time, cryptocurrency is seen as stabilizing in the $88,000 range, and market participants are trying to determine whether this is a buying opportunity or the entrance to further adjustments.
