At the beginning of 2025: The Bitcoin market is changing dramatically

At the beginning of the new year, the cryptocurrency market has plunged into turmoil. Bitcoin quickly fell back after breaking the $100,000 barrier, sparking widespread discussion in the market.

At the beginning of this week, Bitcoin briefly surpassed $100,000, but the good times didn't last long. During the U.S. trading session, the price of Bitcoin plummeted sharply, falling to a low of $92,600, a nearly 10% drop from Monday's peak. Currently, the price of Bitcoin hovers around $94,000.

The drop in Bitcoin has also triggered a chain reaction in the entire cryptocurrency market. Ethereum fell to $3300, Solana dropped below $200, and other altcoins generally fell by about 10%. This wave of decline even affected the US stock market, with several well-known mining companies' stock prices also experiencing a decline of 5-8%.

Although the market's decline is currently manageable, market sentiment has clearly cooled as the price of Bitcoin approaches the beginning of the year levels. Some analysts even predict that Bitcoin may fall to 70,000 dollars before a specific point in time.

The main reasons for this decline are as follows:

1. U.S. macroeconomic data exceeded expectations. The November JOLTS job openings and ISM services PMI data were both better than expected, which may lead the Federal Reserve to maintain a hawkish stance and delay interest rate cuts.

2. Political uncertainty is increasing. There are reports that certain political figures may consider declaring a "national economic emergency" and imposing high tariffs on multiple countries, raising market concerns.

3. Selling pressure on crypto assets. There are reports that the U.S. Department of Justice may liquidate approximately 69,000 Bitcoins related to a certain case, with a total value of around $6.5 billion, which adds extra selling pressure to the market.

However, the market is not entirely pessimistic. Some positive factors are still supporting market confidence:

1. A lawsuit between a well-known exchange and regulatory authorities has taken a turn, which may be beneficial for the legal status of cryptocurrencies.

2. Regulatory attitudes may become more friendly, and new regulatory officials may have a more open stance towards cryptocurrencies.

3. Large investors show confidence in the market and increase their holdings when prices pull back.

Although the market may continue to fluctuate in the short term, most analysts believe that Bitcoin is unlikely to drop significantly to between 70,000 and 80,000 USD. Currently, around 95,000 USD still serves as an important support level.

In the coming week, the market will closely monitor the U.S. December non-farm payroll report. This data may influence the Federal Reserve's policy decisions, which in turn could affect the direction of the cryptocurrency market.

Overall, although market sentiment has declined, the cryptocurrency market may not experience extreme downturns with the support of institutional investors. Investors should closely monitor policy trends and economic data, and view market fluctuations rationally.