Failure to reach $100 000: How trade conflicts are rewriting the Bitcoin narrative

Attempts for Bitcoin to establish itself as “digital gold” received a serious blow on Monday, when prices plummeted amid new geopolitical tensions. The $100,000 mark by the end of January is now considered unlikely, reflecting a deeper shift in investor perception of cryptocurrency. Instead of a safe haven, BTC is increasingly viewed as a traditional risky asset sensitive to political and macroeconomic shocks.

The global crypto market fell more than 7% when President Donald Trump threatened to impose 10% tariffs on Denmark and seven other European countries over his plans regarding Greenland. The European Union quickly responded with a statement defending the sovereignty of the autonomous Danish territory, characterizing the threat as hostile to free markets and prosperity. The reaction was immediate: traders revised their forecasts for the future value of the leading cryptocurrency.

Expectations Collapse on Polymarket

A sharp shift occurred on the decentralized betting platform Polymarket regarding the probability of reaching $100,000. The share of “Yes” contracts dropped to 27% from nearly 50% on Friday and 72% on January 15 — a dramatic change in less than two weeks. This clearly demonstrates how quickly the market overestimates risks.

Bitcoin on Monday dropped to $92,000, according to CoinDesk data. Currently, the price is at $88,030, showing a loss of 2.21% over the past 24 hours. So-called altcoin indices (memecoins, metaverse, DeFi, culture, and entertainment) fell even more — over 7%, highlighting a mass retreat from risky assets.

Classic Flight to Safety, but Not to Bitcoin

Notably, while cryptocurrency markets lost value, gold rose to record highs. Asian and European stock markets also declined, confirming the classic investor behavior during periods of uncertainty. However, the absence of Bitcoin in this “flight to safety” clearly refutes the mantra that it functions as a digital equivalent of gold.

“Bitcoin has fallen for the fifth consecutive day, retreating from its best positions in November and struggling to stay above $92,000,” noted Samer Hassan, senior market analyst at XS.com. “The downward trend is driven by a combination of profit-taking and a shift to risk minimization strategies, as participants overestimate political risks in the US amid rising geopolitical and trade tensions,” he added.

Institutional Signals: A Reason for Cautious Optimism

Despite pessimistic trends, signs of renewed interest from major players are emerging. Spot ETFs for Bitcoin and Ether attracted $1.4 billion and over $500 million respectively last week — before the turn of events. These inflows are the largest since October, indicating a return of institutional investor attention.

Data on activity from large cryptocurrency holders adds confidence to this scenario. According to BGeometrics, the number of wallets holding between 1,000 and 10,000 BTC increased by 28% over the past week. “Whales” are traditionally considered more informed market participants, and their activity often precedes a recovery. However, for a significant market surge, these positive trends need to persist and deepen.

What Will Determine the Next Move?

According to Laser Digital analysts, the short-term price dynamics will depend entirely on the development of trade conflicts between the US and the European Union. “The price movement in the near term is largely determined by the evolution of risks related to tariff threats. Additionally, geopolitical risk remains in the Middle East, where tensions escalated over the weekend,” explained company representatives.

This week, traders’ attention will focus on several key events. The Davos forum, US GDP data releases, key personal consumption expenditure figures, and the expected Supreme Court decision on the legitimacy of Trump’s tariffs — all could significantly impact the cryptocurrency market.

Meanwhile, the Optimism community approved a 12-month plan to buy back OP tokens using about half of the Superchain revenues, starting in February. However, this positive news did not prevent the token’s price from declining, once again demonstrating that in current conditions of growing uncertainty, even corporate actions cannot reverse the overall market sentiment.

Reaching $100,000 now seems like a postponed goal rather than an imminent reality. How the market reacts to upcoming events will determine whether Bitcoin regains its status or remains a volatile risky asset influenced by macroeconomic factors.