The rally in cryptocurrencies that began 2026 has faded, with Bitcoin (BTC) again trading below $90,000 U.S.
Bitcoin, the largest cryptocurrency by market capitalization, has fallen 2% over the past 24 hours and is currently trading at $89,800 U.S.
Other major cryptocurrencies such as Ethereum (ETH), Solana (SOL), and XRP have declined between 2% and 4% in the past day as a broader rally in digital assets collapses.
Bitcoin reached an all-time high of $126,000 U.S. in early October but has steadily decreased since reaching that milestone.
Several attempts by BTC to rise above $95,000 U.S. in recent months have failed as investors pivot away from risk assets such as crypto.
Spot Bitcoin exchange-traded funds (ETFs) in the U.S. saw $486 million U.S. in outflows on Jan. 7, their second consecutive day of negative action.
The fading of the crypto rally comes despite markets increasing their bets that the U.S. Federal Reserve will deliver more interest rate cuts in 2026 than previously expected.
Lower interest rates are generally positive for riskier investments such as crypto.
Some analysts say they don’t see any immediate catalysts on the horizon for Bitcoin or other cryptocurrencies, raising the prospect of a prolonged downturn in digital assets.
BTC has declined 7% over the last 12 months.
