Bitcoin faces negative performance in 2026 after widespread declines in risk markets

Bitcoin has posted a negative performance year-to-date, with the digital asset falling below the $84.89K after a significant correction that swept away the gains accumulated since the start of 2026. The largest cryptocurrency has lost approximately 5,32% over the past 24 hours, extending the bearish pressures dominating global risk asset markets.

Massive Bitcoin crash breaks bullish streaks from start of the year

Although President Donald Trump delivered reassuring remarks at the World Economic Forum in Davos — stating that the United States has no intention of occupying Greenland by force — this was insufficient to reverse the negative sentiment dominating markets. Bitcoin briefly bounced above $90,000 following his comments, but the recovery was short-lived.

The price movement reflects weak market sentiment, where even potentially positive news for the crypto sector fails to generate sustained bullish traction. Trump also expressed optimism about the passage of a framework law for the structure of the crypto market, but this signal also failed to anchor prices in positive territory.

Trump tries to calm markets in Davos, but bulls fail to regain control

Hopes that the presidential statements would reinvigorate risk appetite quickly dissipated. While traditional markets — represented by the Nasdaq and S&P 500 — maintained modest gains during Wednesday’s session, cryptocurrencies remained in red territory, widening the yield gap between traditional and digital assets.

Other major crypto assets saw similar declines: Ethereum trades at $2.82K, XRP to $1.81 and Solana to $118.30, confirming that the bearish pressure is widespread and not limited to Bitcoin alone.

Cascading liquidations put additional pressure on digital assets

Bitcoin’s correction towards the $84,000 zone triggered a cascade of liquidations, generating more than $650 million in closed positions forcibly throughout the crypto market. This liquidation dynamic amplified volatility and created negative feedback loops that further pushed prices lower.

Simultaneously, while gold continued its bullish rally, another 1,5% to reach a new all-time high above the $4,800 per ounce, cryptocurrencies were moving in the opposite direction. This divergence highlights how investors are rotating from risky assets to traditional defensive hedges.

Crisis contagion: how panic in Japanese bonds affects the entire crypto market

The root of the problem does not lie solely in local geopolitical considerations. A critical factor has been the turbulence in Japanese government bond markets that erupted on Tuesday, sending a shockwave of risk aversion through global financial markets.

Arthur Hayes, a renowned global macroeconomics and cryptocurrency analyst, characterized the sharp rise in Japanese bond yields as “The Spark” that could trigger a global cycle of systematic risk rejection. “Let’s see how big the fire gets,” Hayes warned, suggesting that the impact could extend significantly beyond Asian markets.

Although Japanese bonds and stocks recovered modestly on Wednesday, the effects continue to ripple through the international financial system. Cryptocurrencies, as assets highly correlated with global risk appetite, experience the amplified impact of these macroeconomic dynamics.

How far will it fall? Analysts warn that the worst could be yet to come

For bullish investors, the outlook becomes challenging. While certain funding indicators suggest that a temporary downgrade may be forthcoming, other analysts warn that a sustained upward reversal may not materialize until the Federal Reserve adopts a significantly more accommodative monetary policy stance.

This view implies that Bitcoin’s negative performance could extend beyond the next few sessions, especially if global macroeconomic pressures and risk aversion persist. Markets remain cautious, with daily lows still intact, raising questions about potential new lower support levels.