On January 25, 2026, Bitcoin dropped below $88,000, triggering $135 million in long liquidations and contributing to a broader crypto market decline. The total market capitalization fell below $3 trillion after shedding $220 billion over the past week. Ethereum also tumbled to $2,800 as bearish patterns and macroeconomic risks weighed on investor sentiment.
The cryptocurrency market experienced a sharp downturn on January 25, 2026, with Bitcoin leading the decline. The leading cryptocurrency slid under $88,000 on Sunday, erasing gains from a weekly high above $92,000 reached on January 19. This movement triggered approximately $135 million in crypto long liquidations within the past hour, intensifying selling pressure across digital assets.
Over the preceding seven days, the crypto economy lost roughly $220 billion, bringing the total market capitalization to around the $3 trillion mark. The CoinMarketCap 20 Index dropped by over 2.2% in the last 24 hours and 10% over the week. Ethereum followed suit, falling to $2,800, while altcoins broadly entered the red.
Technical indicators pointed to further downside for Bitcoin. On daily and weekly charts, the price remained below the Supertrend indicator and the 50-day Exponential Moving Average. It also formed a bearish flag pattern, consisting of a vertical line and an ascending channel, now testing the lower boundary. Analysts noted potential drops to the November low of $80,400, and possibly the April low of $74,000 if support breaks.
Market sentiment soured, with the Crypto Fear and Greed Index falling to 34 in the fear zone from a year-to-date high of 59. Contributing factors included risks of a hawkish Federal Reserve stance following strong U.S. economic data: third-quarter growth continued, with fourth-quarter estimates at 5%, improved labor markets, and stabilized inflation.
Geopolitical tensions added pressure, as the U.S. threatened a 100% tariff on all goods from Canada, its largest trade partner, prompting retaliation warnings. Domestically, a potential government shutdown loomed due to protests in Minnesota, with Democrats demanding Department of Homeland Security reforms before approving funding.
Investor rotation exacerbated the selloff, with spot Bitcoin exchange-traded funds losing over $1 billion in assets this year, while gold and silver ETFs gained billions. XRP sank to session lows amid intensifying macro uncertainty and trade tensions, signaling sustained bearish momentum across the sector.
Bitcoin's movements typically dictate broader market trends, where retreats often lead to further downside in altcoins.
