Bitcoin Dips Under $89K, Extending Losses as Nasdaq Futures Drop and Risk-Off Sentiment Grows

Bitcoin Drops Below $89K as Market Turmoil Deepens, Yen Surge Fuels Risk-Off Sentiment

Bitcoin (BTC) slipped under $89,000 on Tuesday, marking a fresh three-month low as risk-off sentiment gripped global markets. A continued downturn in U.S. equities and a rallying Japanese yen added to fears that investors are shifting away from risk assets.

BTC fell to $87,000—its lowest since mid-November—while the broader crypto market followed suit. Ether (ETH) slid 9% to $2,400, Solana (SOL) plunged 14%, and Dogecoin (DOGE) and XRP (XRP) each lost 11%. The CoinDesk 20 Index (CD20), which tracks major crypto assets, dropped 7%.

Despite former U.S. President Donald Trump’s recent pro-Bitcoin stance, political headwinds remain a challenge. “The failure of Bitcoin reserve proposals in states like Montana, North Dakota, and Wyoming underscores the challenges of mainstream adoption at the government level,” said Valentin Fournier, analyst at BRN. “There’s still reluctance among policymakers to back Bitcoin due to concerns over volatility and potential taxpayer risks.”

Fournier noted that if the U.S. were to integrate Bitcoin into its national reserves, a structured approach—such as backing it with government bonds or a partial gold reserve sale—would likely be required.

Bitcoin’s weakness also aligns with a contraction in global liquidity. “There’s a historical lag between global money supply and Bitcoin’s price action,” said Andre Dragosch, head of European research at Biwise. “With money supply recently bottoming out, BTC’s downturn may be short-lived.”

Traditional markets are also showing clear risk-off signals. Nasdaq futures dipped another 0.3% early Tuesday, extending a three-day slide that has seen the index drop more than 4% since February 18.

Meanwhile, the Japanese yen strengthened to 149.38 per U.S. dollar, nearing Monday’s three-month high of 148.84. The yen has gained nearly 6% over the past six weeks amid growing speculation that the Bank of Japan (BOJ) may hike interest rates.

A similar scenario played out last July when a rapid yen surge led to a broader sell-off in risk assets, pushing Bitcoin from $65,000 to $50,000 in just a few days.

“The yen’s sharp gains are a classic signal of risk aversion,” noted Joseph Wang, operator of research portal FedGuy.com. “If history repeats itself, we could see more pain ahead for Bitcoin and the broader crypto market.”