Bitcoin experienced a brief decline beneath the pivotal $90,000 threshold on Wednesday, driven largely by escalating geopolitical unease stemming from the strained U.S.-Greenland relationship and mounting fiscal apprehensions regarding Japan. These developments negatively affected investor sentiment towards riskier assets such as cryptocurrencies.
At 10:10 a.m. ET (15:10 GMT), the world's largest cryptocurrency was trading at $90,226, marking a 0.5% decrease after dipping below $90,000 earlier in the session and approaching some of its lowest valuations recorded this year.
The cryptocurrency logged a sluggish beginning to 2026, unable to retain gains amid declining global risk tolerance. The momentum was further dampened by delays in passing a significant U.S. crypto regulatory bill, undermining prospects for near-term market growth.
Geopolitical Strains and Fiscal Worries Impact Crypto Markets
Bitcoin's downturn and the broader underperformance across crypto assets were influenced primarily by rising concerns over U.S. President Donald Trump’s firm stance on Greenland. Trump has demanded tariff measures against eight European countries tied to negotiations involving Greenland and has not excluded the possibility of military intervention concerning the Danish territory.
As part of ongoing diplomatic maneuvers, Trump was scheduled to participate in the World Economic Forum in Davos, Switzerland, where he intended to engage diverse stakeholders about Greenland.
Concurrently, investors have exhibited apprehension over fiscal fragilities across developed economies, with particular focus on Japan. This week’s surge in global bond yields was notably linked to Japanese debt anxiety, considering the country holds the largest debt stock among advanced nations.
The urgency intensified following Japanese Prime Minister Sanae Takaichi's declaration of a snap election set for early February. Market participants are questioning how Japan plans to finance Takaichi’s ambitious fiscal initiatives, which include significant stimulus and expanded tax reliefs, fueling unease about Japan’s fiscal trajectory.
Concerns over global geopolitical risk and fiscal health combined to push investors away from volatile assets like cryptocurrencies into traditional safe havens, most prominently gold, which has recently hit multiple record highs.
Corporate Bitcoin Purchases Provide Limited Support
Despite the pressure on Bitcoin prices, Strategy Inc, the top corporate Bitcoin holder, disclosed substantial purchases totaling approximately 22,305 coins from January 12 to January 19, valued at roughly $2.13 billion. This acquisition increased Strategy's Bitcoin holding to 709,715 coins, solidifying its position as the largest corporate custodian of the cryptocurrency.
Nevertheless, the announcement failed to buoy market sentiment substantially. Shares of Strategy fell by 7% following the disclosure, with Bitcoin's price showing minimal positive response.
Investor skepticism towards Strategy's Bitcoin acquisition strategy has persisted over the past year due to notable underperformance causing steep unrealized losses on its digital asset portfolio. In early January, the company revealed a $17.44 billion unrealized loss on its crypto assets for the fourth quarter, further intensifying scrutiny over the sustainability of its debt- and equity-financed Bitcoin purchasing model.
Strategy's stock value declined by nearly 50% throughout 2025, reflecting ongoing investor dissatisfaction.
Altcoin Market Remains Subdued
The broader cryptocurrency market exhibited modest movements, with Ethereum, the second-largest digital asset, falling 0.7% to $2,988.58, nearing its weakest level since late December. XRP increased by 1%, whereas Binance Coin (BNB) declined by 1.5%. Meanwhile, Solana and Cardano edged upward by 1.8% and 1%, respectively.
Memecoins such as Dogecoin and $TRUMP showed marginal gains, rising less than 1% each.