For the first time since Donald Trump’s inauguration, Bitcoin has plummeted below the $100,000 mark, triggering a wave of uncertainty across global markets. The drop to $98,046 comes as the AI application DeepSeek from China tops U.S. App Store charts, overshadowing OpenAI’s ChatGPT and unsettling investors.
Alvin Kan, COO at Bitget Wallet, explained the phenomenon: “The hype around DeepSeek and broader volatility in the U.S. AI market has spooked investors, leading to a flight to safety.” He further highlighted that with no anticipated rate cuts from the upcoming Federal Reserve meeting, “the market is pricing in a more hawkish tone, adding to the cautious mood,” as shared with Cointelegraph.
Crypto Market Sees Red, Liquidations Ramp Up
Monday proved brutal for cryptocurrency traders as major coins took double-digit percentage hits. Solana (SOL-USD) and Dogecoin (DOGE-USD) each tumbled over 10%, with similar plummets seen across other major cryptocurrencies including Ethereum (ETH-USD), XRP (XRP-USD), and BNB (BNB-USD). The overall crypto market cap shrank by 8.5% by the end of the day in Asian markets, with $770 million in bullish positions liquidated, nearing the high seen on January 18th.
This massive sell-off was largely driven by investor reactions to both the unexpected rise of DeepSeek and the hawkish signals from the U.S. Federal Reserve.
These stark market movements illustrate a broader trend of AI innovations impacting financial markets and the potential for increased volatility surrounding Fed decisions. As traders navigated this shaky terrain, the largest single liquidation order was recorded on HTX—a tether-margined Bitcoin trade valued at $98.4 million.
At the time of writing, Bitcoin is sitting at $99,031.40.
