Bitcoin Rallies 4% to $103,000, Easing Monday’s Setback; XRP Soars 12% in Market Rebound
Bitcoin (BTC) climbed by 4% in the past 24 hours, reaching nearly $103,000 by Tuesday morning, partially recovering from the losses sustained on Monday. This rally follows a turbulent day in the markets, triggered by concerns over China’s DeepSeek AI breakthrough, which caused a significant sell-off in U.S. stocks.
XRP led the charge among major cryptocurrencies, surging 12%, while other notable tokens like Cardano (ADA), Binance Coin (BNB), Solana (SOL), and Dogecoin (DOGE) also saw impressive gains, rising up to 9%. Ethereum (ETH) increased by 4.5%, contributing to a 3% overall rise in market capitalization.
The recent upward movement in Bitcoin’s price helped counterbalance the losses from Monday’s crash, which saw more than $1 billion in futures liquidations and an 8.5% drop in the CoinDesk 20 (CD20) index at its lowest point. Typically, such liquidation events are seen as signs of market corrections, often paving the way for buying opportunities, as CoinDesk observed.
Among midcap cryptocurrencies, TRUMP tokens were at the forefront, rising 12% in a broader recovery among tokens with a market cap below $5 billion. This resurgence was further fueled by Tuttle Capital’s filing for the first-ever 2x leveraged ETFs in the U.S., which would provide 200% returns based on the daily price movements of major cryptocurrencies, including TRUMP, MELANIA, and BONK.
The sharp decline on Monday was largely attributed to DeepSeek’s AI advancements, as the Chinese firm’s model was shown to outperform OpenAI’s, despite operating on a far smaller budget and fewer GPUs. DeepSeek’s technology, developed with only $6 million, challenged OpenAI, which raised $6.6 billion and boasts a $157 billion valuation.
Despite the fears stirred by DeepSeek’s breakthrough, some market participants view it as just one of many factors affecting crypto markets. Nick Ruck, director at LVRG Research, emphasized that while the AI development caused initial panic, it presented a buying opportunity for crypto. “The crypto industry is not directly competing with DeepSeek, and its open-source model could actually benefit crypto projects by enhancing efficiency and driving further innovation,” Ruck explained.
Investors are now turning their attention to upcoming macroeconomic data, including the Federal Open Market Committee (FOMC) meeting on January 28–29, and earnings reports from major firms like Apple, Meta, and ASML. Ruck remains optimistic about Bitcoin’s long-term outlook, noting that U.S. and global policies are becoming more favorable for the growth of the crypto sector.
As for the FOMC meeting, no rate cuts are expected, which could have an impact on Bitcoin’s price, as investors tend to adjust their positions depending on the Federal Reserve’s policy stance.
Adding a unique touch to their market analysis, Singapore-based QCP Capital offered astrological insights in their Tuesday market update, tying the market’s fluctuations to the symbolism of the Year of the Snake in Chinese astrology. The firm noted that the qualities of resilience and adaptability, which the Snake represents, will be vital for navigating the uncertainties of 2025.
Bitcoin proved to be a strong performer in 2024, the Year of the Dragon, and analysts are hopeful that 2025 will bring new highs, especially considering the unpredictable twists predicted by astrological charts involving the “Rough Green” and “Brown Tree” snakes.
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