Bitcoin Dips Below $100,000 Amid Global Tech Selloff Triggered by Chinese AI Advancements

Bitcoin drops to 11-day low amid tech selloff

Bitcoin fell below $100,000 on Monday, hitting its lowest in 11 days, in a move analysts attributed to a wave of caution after the surging popularity of a Chinese artificial intelligence model sparked a selloff in Western AI-related stocks.Bitcoin fell below $100,000 on Monday, hitting its lowest in 11 days, in a move analysts attributed to a wave of caution after the surging popularity of a Chinese artificial intelligence model sparked a selloff in Western AI-related stocks. The world's biggest cryptocurrency struggled to make gains last week, as a rally that had seen it break above $100,000 after U.S. President Donald Trump's election ran out of steam. At 1156 GMT, bitcoin was at $98,852.17, down around 6% on the day, having fallen sharply in early trading to hit its lowest since Jan. 16. Technology stocks plunged, as traders worried that Chinese AI startup DeepSeek could threaten Western companies' dominance of the sector, in a move some called AI's "Sputnik moment", referring to the former Soviet Union's launch of a satellite that marked the start of the space race in the late 1950s. Bitcoin's losses are "seemingly driven by some risk-off sentiment circulating the markets currently due to DeepSeek," wrote eToro analyst Simon Peters. Geoffrey Kendrick, global head of digital asset research at Standard Chartered, said a decline in Nasdaq futures had hurt crypto markets, but that disappointment over the Trump administration's announcement about a cryptocurrency stockpile had put digital assets more at risk of a sharp selloff. Crypto failed to feature in Trump's day-one announcements after taking office last week, leaving some investors disappointed. In an executive order on Thursday, Trump created a working group to draft new crypto rules and explore a crypto stockpile, while the Securities and Exchange Commission (SEC) spiked accounting guidance that the industry said had stymied crypto adoption. The prospect of interest rates staying higher for longer also hurt riskier assets, said Thomas Puech, CEO of digital asset hedge fund Indigo. U.S. Federal Reserve policymakers meet this week and are expected to keep interest rates on hold.

Bitcoin drops to 11-day low amid tech selloff

LONDON (Reuters) - Bitcoin fell below $100,000 on Monday, hitting its lowest in 11 days, in a move analysts attributed to a wave of caution after the surging popularity of a Chinese artificial intelligence model sparked a selloff in Western AI-related stocks. The world's biggest cryptocurrency struggled to make gains last week, as a rally that had seen it break above $100,000 after U.S. President Donald Trump's election ran out of steam. At 1156 GMT, bitcoin was at $98,852.17, down around 6% on the day, having fallen sharply in early trading to hit its lowest since Jan. 16. Technology stocks plunged, as traders worried that Chinese AI startup DeepSeek could threaten Western companies' dominance of the sector, in a move some called AI's "Sputnik moment", referring to the former Soviet Union's launch of a satellite that marked the start of the space race in the late 1950s. Bitcoin's losses are "seemingly driven by some risk-off sentiment circulating the markets currently due to DeepSeek," wrote eToro analyst Simon Peters. Geoffrey Kendrick, global head of digital asset research at Standard Chartered, said a decline in Nasdaq futures had hurt crypto markets, but that disappointment over the Trump administration's announcement about a cryptocurrency stockpile had put digital assets more at risk of a sharp selloff. Crypto failed to feature in Trump's day-one announcements after taking office last week, leaving some investors disappointed. In an executive order on Thursday, Trump created a working group to draft new crypto rules and explore a crypto stockpile, while the Securities and Exchange Commission (SEC) spiked accounting guidance that the industry said had stymied crypto adoption. The prospect of interest rates staying higher for longer also hurt riskier assets, said Thomas Puech, CEO of digital asset hedge fund Indigo. U.S. Federal Reserve policymakers meet this week and are expected to keep interest rates on hold. (Reporting by Elizabeth Howcroft; Editing by Amanda Cooper and Louise Heavens)

Bitcoin Drops to 11-Day Low Amid Tech Selloff

LONDON (Reuters) - Bitcoin fell below $100,000 on Monday, hitting its lowest in 11 days, in a move analysts attributed to a wave of caution after the surging popularity of a Chinese artificial intelligence model sparked a selloff in Western AI-related stocks. The world's biggest cryptocurrency struggled to make gains last week, as a rally that had seen it break above $100,000 after U.S. President Donald Trump's election ran out of steam. At 1156 GMT, bitcoin was at $98,852.17, down around 6% on the day, having fallen sharply in early trading to hit its lowest since Jan. 16. Technology stocks plunged, as traders worried that Chinese AI startup DeepSeek could threaten Western companies' dominance of the sector, in a move some called AI's "Sputnik moment", referring to the former Soviet Union's launch of a satellite that marked the start of the space race in the late 1950s. Bitcoin's losses are "seemingly driven by some risk-off sentiment circulating the markets currently due to DeepSeek," wrote eToro analyst Simon Peters. Geoffrey Kendrick, global head of digital asset research at Standard Chartered, said a decline in Nasdaq futures had hurt crypto markets, but that disappointment over the Trump administration's announcement about a cryptocurrency stockpile had put digital assets more at risk of a sharp selloff. Crypto failed to feature in Trump's day-one announcements after taking office last week, leaving some investors disappointed. In an executive order on Thursday, Trump created a working group to draft new crypto rules and explore a crypto stockpile, while the Securities and Exchange Commission (SEC) spiked accounting guidance that the industry said had stymied crypto adoption. The prospect of interest rates staying higher for longer also hurt riskier assets, said Thomas Puech, CEO of digital asset hedge fund Indigo. U.S. Federal Reserve policymakers meet this week and are expected to keep interest rates on hold. (Reporting by Elizabeth Howcroft; Editing by Amanda Cooper and Louise Heavens)

Bitcoin briefly falls below $100,000 as China AI threat sparks stock market rout

Bitcoin briefly dipped below $100,000 early Monday as a global technology stock sell-off rattled markets to start the week. The largest cryptocurrency by market capitalization was down 3.51% as of Monday morning, bringing its price to $101,295 apiece. That was a recovery from a low of about $97,900 earlier in the day. Bitcoin has been boosted in recent months by President Donald Trump's return to the White House, which first sent the popular coin above $100,000 last month in the aftermath of his election victory. Last week, Trump signed an executive order that set the stage for industry-friendly regulations and a national cryptocurrency stockpile -- key campaign promises he made to the industry. But Bitcoin isn't immune from other market turmoil. Contracts for all three major U.S. indices fell tumbled Monday morning as a perceived threat from Chinese artificial intelligence startup DeepSeek prompted a global sell-off of tech stocks. Futures of the tech-heavy Nasdaq plunged more than 800 points, or roughly 4%. Dow Jones Industrial Average futures, an index of 30 of the largest U.S. companies including Nvidia (NVDA-3.33%), were also down more than 300 points as of Monday morning. S&P 500 futures tumbled 2%. The sell-off was prompted by DeepSeek's announcement last week that it launched a model rivaling OpenAI's ChatGPT and Meta's (META+1.48%) Llama 3.1 built using lower capability chips from Nvidia, which could put pressure on the semiconductor darling if other firms move away from its premium offerings. In December, the private company launched a free, open source large language model (LLM), which it claimed it had developed in just two months for less than $6 million. Analysts at Wedbush said in a research note Monday that "tech stocks are under massive pressure led by Nvidia as the Street will view DeepSeek as a major perceived threat to U.S. tech dominance and owning this AI Revolution." Investors are also awaiting the Federal Reserve's upcoming interest rate decision on Wednesday. Fed policymakers are expected to hold rates steady following this week's meeting, according to the CME FedWatch tool. The Fed reduced rates by a full percentage point in the span of three months last year, bringing the benchmark federal funds rate to 4.25%-4.50%. Fed Chair Jerome Powell signaled a more cautious approach to interest rates this year, as concerns about balancing rising inflation with the strong labor market persist. "As for additional cuts, we're going to be looking for further progress on inflation as well as continued strength in the labor market," Powell said in a news conference following the committee's December meeting. "And as long as the economy and the labor market are solid, we can be cautious as we consider further cuts."

Bitcoin falls below $100K for the first time under Trump presidency

Bitcoin fell below $100,000 for the first time since US President Donald Trump took office on Jan. 20, as global markets reacted to rising competition in the AI sector and shifting monetary policies. The world's largest cryptocurrency by market capitalization dropped to as low as $98,046 on Jan. 27. Much of the turbulence has been attributed to the rapid rise of China-based AI app DeepSeek, which claimed the top spot on Apple's App Store rankings in the US, displacing ChatGPT to third place just a week after its launch. "The hype around DeepSeek and broader volatility in the US AI market has spooked investors, leading to a flight to safety," Alvin Kan, chief operating officer at Bitget Wallet, said in a statement shared with Cointelegraph. Related: DeepSeek rout costs bulls $100K -- 5 Things to know in Bitcoin this week "With the next Federal Reserve meeting approaching and expectations of no rate cuts, the market is pricing in a more hawkish tone, adding to the cautious mood," Kan added. DeepSeek's AI model, reportedly developed with $6 million, has intensified fears of an escalating AI arms race, and its success has reverberated through global markets. Nvidia, whose dominance in the AI boom drove its valuation to a world-leading $3.49 trillion, shed 3.12% by the Jan. 24 closing bell. For the crypto market, around $864 million in positions were wiped out, with Bitcoin "Some derivatives who put bullish position on margin got called," Justin d'Anethan, head of sales at token launch advisory firm Liquifi, told Cointelegraph. "The scramble for downside protection suggests traders are bracing for further chop. With no major catalysts until this week's [Federal Open Market Committee], the market is likely to hover in this range as it waits for fresh policy cues," he added. Related: The release of DeepSeek R1 shatters long-held assumptions about AI The US Federal Reserve's first interest rate decision under President Trump is scheduled for Jan. 28 and Jan. 29, which is expected to remain unchanged at 4.25% to 4.5%, according to the CME FedWatch tool. But analysts at Matrixport present a bull case despite piling negative market sentiment. The crypto services firm points to the Chinese New Year and Lunar New Year celebrations across Asia this week, which it calls the "most statistically favorable 20-day window for Bitcoin." Magazine: They solved crypto's janky UX problem. You just haven't noticed This article does not contain investment advice or recommendations. Every investment and trading move involves risk, and readers should conduct their own research when making a decision.

Why Bitcoin fell below $100,000 as Chinese AI breakthrough triggers market turmoil and selloff

Bitcoin (BTC-USD) and other cryptocurrencies saw a significant drop on Monday as a new Chinese AI model, developed by startup DeepSeek, rattled markets.Bitcoin (BTC-USD) and other cryptocurrencies took a sharp dip on Monday as the emergence of a new Chinese artificial intelligence (AI) model caused a global selloff in riskier assets. Bitcoin dropped by as much as 6.5% during the morning in London, marking its largest intraday loss since December 6. Other smaller cryptocurrencies like XRP and Solana saw even bigger losses, with XRP falling by 9% and Solana following a similar trend. This sudden drop in the crypto market came as a reaction to the development of a new AI model by Chinese startup DeepSeek, which is being seen as a serious challenge to U.S. tech companies. The fears surrounding this Chinese AI model have spread across global markets, causing weakness not just in crypto but also in stocks, particularly in tech sectors. The sharp drop in Bitcoin and other cryptocurrencies is largely attributed to the concerns over DeepSeek's new AI model. This AI model, which is being described as cost-efficient and groundbreaking, has created anxiety among investors. The primary worry is that it could disrupt the dominance of U.S. tech companies in the AI space, particularly in the areas of large language models (LLMs) and other advanced AI technologies. Also Read : Donald Trump getting back at his detractors with a vengeance, revokes security of 50 former officials in an unprecedented move In a report, QCP Asia stated, "The Chinese LLM poses a potential threat to US equity markets by disrupting US AI dominance with their cost efficiency and groundbreaking open-source technology." The report went on to raise the question: "How will Trump retaliate?" This uncertainty surrounding the future of AI innovation has contributed to the overall risk-off sentiment that is affecting both stocks and crypto markets. Just days before the crypto market slump, President Donald Trump issued an executive order aimed at supporting the cryptocurrency industry. The order created a working group to advise the White House on crypto policy and proposed a framework for digital assets in the U.S. However, despite the optimism surrounding this executive order, many crypto traders felt the news had already been priced in. Sean McNulty, head of APAC derivatives at FalconX, pointed out that anything short of a Bitcoin reserve, which would immediately start buying BTC, would have disappointed investors. "Even though the market got 90% of what it wanted with the executive orders, it evidently was mostly priced in," McNulty said. Trump's stance on crypto has evolved over time, with the president now pledging to make the U.S. the world's crypto capital. This shift is largely due to the growing involvement of the crypto industry in U.S. politics. Following his election victory, Trump named venture capitalist David Sacks as the AI and crypto czar to push forward pro-crypto policies. Despite the executive orders, the market's reaction has been subdued. Bitcoin and other cryptocurrencies posted modest gains immediately after the announcement but have since seen a significant drop. Many experts believe that the news about Trump's executive orders was already anticipated by traders, and anything short of an immediate Bitcoin reserve was unlikely to have a lasting impact. Justin d'Anethan, head of sales at Liquifi, noted that after a string of bullish news regarding crypto regulation and new financial products, the market seems to be taking a breather. "After a string of bullish news -- like pro-crypto regulatory appointments, new ETF product filings, and executive orders -- the market seems to be catching its breath," he said. While the crypto market struggles with this uncertainty, other factors have also played a role in market movements. In early trading on Monday, Asian stocks rose, even though concerns about a potential trade war resurfaced after Trump imposed sanctions on Colombia. At the same time, fears that DeepSeek's AI model could disrupt the technology sector have spread across futures markets and into digital assets. Also Read : Donald Trump inauguration: What is the exact time the transition of power is official? Here are all details Jonathan Yark, a senior quant trader at Acheron Trading, explained that the uncertainty over DeepSeek's AI technology has had a ripple effect on digital assets. "Concerns that DeepSeek may disrupt the technology world have cascaded across futures and into digital assets," Yark said. As of 10 a.m. on Monday, Bitcoin was trading at around $99,200, continuing its downward trend after the initial selloff triggered by AI concerns. Why did Bitcoin fall below $100,000? Bitcoin dropped below $100,000 due to concerns over a Chinese AI model from DeepSeek, which sparked a selloff in global markets, including cryptocurrencies. How is DeepSeek's AI model affecting the market? DeepSeek's AI model is disrupting tech and crypto markets by challenging U.S. dominance in AI, leading to uncertainty and risk-off sentiment among investors.