Bitcoins quickly falling back to $84,000 during the US morning hours. Thursday came along with equally rapid declines in stocks and precious metals.
But while stocks, gold and silver have since bounced back from their worst levels, crypto is still near its session lows with BTC, Ether XRP and solana all down 5%-7% over the last 24 hours.
“Everything from weak earnings results to concerns about Iran and the government shutdown are causing a broad-based selloff,” said Joshua Lim, global co-head of markets at prime brokerage FalconX. “It’s triggering a major sell-off across consensus hedge funds and commodity trading advisors in metals and equities.”
“And crypto is also taking some pain from the general risk-off sentiment,” he added.
Thursday’s selloff triggered over $650 million in liquidations of bullish leveraged positions betting on higher prices across all cryptoassets, according to data from CoinGlass, the second most violent flush over the past month.
Funding rates suggest bottoming out
Perpetual swap funding rates – a key measure of market froth – have now turned bearish across major tokens, including for ETH, SOL and XRP. In perpetual futures contracts, which have expiration dates, financing rates are periodic payments exchanged between traders based on the difference between the perpetual contract price and the spot price.
When funding turns negative, it means that short sellers (those betting on lower prices) are paying longs (those betting on a rebound) to hold their positions – signaling that the majority of traders are leaning bearish.
Historically, sustained negative fund rates have often preceded short-term bottoms, as overly crowded short positions become vulnerable to sudden price reversals.
Some key levels
US spot bitcoin ETF buyers have a total cost basis near $84,099, just barely below the current price of $84,400. Meanwhile, the true market average price, a long-term fair value derived from Investor Cap divided by Active Supply, is just above $80,000. This $80,000 closely matches the November 2025 low, making it an important structural support zone and potential mean retracement point.
However, a sustained break below $80,000 would likely open the door to a retest of April 2025 levels, as bitcoin briefly fell to around $76,000 amid the selloff triggered by President Donald Trump’s tariff efforts.
How bad is it and what can turn things around
January isn’t over yet, but bitcoin is on track to post its fourth straight monthly loss – very remarkable given that BTC wasn’t down for four straight months, even in the midst of its 80% fall in the crypto winter of 2022. You’d have to go back to 2019 to find a streak of four consecutive lower monthly candles for bitcoin.
“The stock market has been all about AI infra trading, supported by deregulation and tax breaks coming into play this year,” said Mark Connors, chief investment officer at Risk Dimensions. “This has overshadowed BTC, that and the standard gold lead BTC pattern we saw in 2020. I think BTC will not take its next leg higher until we have a ‘print’ from the US.”
