Bitcoin Drops Below $90K, Altcoins Bleed as Crypto Market Corrects

Bitcoin’s impressive run, which began on January 2nd with a push from under $88,000 to over $90,000, has come to a definitive halt. The asset faced a critical rejection at a multi-week peak just under $95,000 on Tuesday morning, a level it could not sustain after gaining approximately $7,000 in a matter of days. This rapid ascent made a technical correction almost inevitable, according to market analysts. The initial pullback was volatile, with Bitcoin oscillating between $93,200 and $94,400 before being driven down to $91,200, all within hours.

By Wednesday evening and into Thursday, bearish momentum took full control, decisively pushing Bitcoin’s price below the psychologically significant $90,000 level. As of the latest data, Bitcoin struggles to reclaim this mark, with its market capitalization declining to around $1.8 trillion. Its dominance over the broader altcoin market remains substantial, hovering near 57%, indicating that while Bitcoin corrected, it retained a larger share of the total crypto market value. The sell-off was partly attributed to profit-taking after the sharp rally and was exacerbated by geopolitical tensions, including a brief dip following news of a U.S. military operation against Venezuela over the weekend.

The alternative cryptocurrency market mirrored and often exceeded Bitcoin’s downturn, entering a deep ‘red’ zone on a daily scale. Ethereum, the second-largest crypto asset, was stopped at resistance around $3,250 and has since retreated to just above $3,100. Binance Coin (BNB) dumped beneath the $900 level, while Cardano (ADA) fell below $0.40. These declines represent significant pullbacks from recent highs for these major assets.

However, the losses were more severe for other tokens. XRP plunged by over 6% on a daily scale and is down by double digits since its recent multi-week peak, now trading around $2.10. The most dramatic move was seen in Zcash (ZEC), which dumped by over 20%, making it the biggest loser among the top 100 altcoins. This steep decline was directly triggered by the announcement that one of its core developers was leaving the project, highlighting how project-specific news can drive extreme volatility in the altcoin space.

The sell-off was broad-based, with other notable altcoins like PEPE, Uniswap’s UNI, SUI, and Cronos’s CRO also registering significant declines. The collective damage is reflected in the total cryptocurrency market capitalization, which shed approximately $100 billion in a single day, falling to about $3.170 trillion. This sharp contraction underscores the highly correlated nature of crypto assets during periods of market stress, where Bitcoin’s direction often sets the tone for the entire sector.

The current market dynamic marks a clear shift from the bullish sentiment that characterized the start of the year. The rapid rejection at higher price levels for Bitcoin and the subsequent cascade across altcoins suggest that traders are locking in profits and adopting a risk-off approach. The event surrounding Zcash exemplifies how idiosyncratic risks within individual projects can compound broader market corrections, leading to outsized losses for specific tokens.

While Bitcoin’s dominance remains high, indicating it is weathering the storm slightly better than altcoins in relative terms, the overall picture is one of correction and consolidation. Market participants are now watching to see if Bitcoin can find stable support around or above the $90,000 level or if further downside is in store. The coming days will be critical in determining whether this is a healthy pullback within a longer-term uptrend or the beginning of a more sustained bearish phase for cryptocurrencies, with all eyes on key support levels and broader macroeconomic cues.