Bitcoin’s ETF-fueled rally stalled as tariff headlines hit risk appetite, sending prices lower and flushing out leverage.
Bitcoin price has moved past $95,000 for the first time since November. Strong spot ETF inflows and easing inflation data drove the move. Buying pressure pushed BTC close to $98,000 before U.S. tariff headlines flipped market sentiment. Within hours, prices slid to the $92,000 range with leverage wiped out.
Bitcoin Clears $95K Resistance as ETF Inflows Drive Strong Weekly Rally
Bitcoin pushed higher last week, breaking out of a tight range that had limited price action for nearly two months. Buying pressure came mainly from spot Bitcoin ETFs, which saw renewed demand after a slow start. Tuesday alone recorded roughly $760 million in net inflows, pushing weekly totals to about $1.4 billion.
Macro conditions added support to the rally as fresh inflation data pointed to easing price pressure. Core CPI slowed to 2.6% year-on-year, the lowest reading since early 2021. Bitcoin also attracted flows as traders rotated back into hard assets after weeks of underperformance.
Image Source: X/Wintermute
Moreover, BTC broke cleanly above the $95,000 ceiling that had capped gains since November. The OG coin briefly touched levels near $98,000. Unlike past rallies, flows drove the move, giving the breakout more credibility.
Geopolitical Tensions Weigh on Crypto, Forcing $850M Liquidation Wave
On Monday, market confidence weakened as geopolitical risk entered the picture. President Donald Trump announced new tariffs, starting at 10% on imports from eight European countries over Greenland-related disputes. Plans also include raising the tariffs to 25% by June.
European Union officials responded by preparing up to €93 billion in retaliatory measures, while tensions involving Iran continued to simmer.
Risk sentiment shifted sharply as markets priced in rising macro uncertainty. Selling pressure spread across risk assets, with crypto following the broader move. Bitcoin fell from weekend highs back toward $92,000, triggering around $850 million in long liquidations within hours.
Nearly half of those losses came from Bitcoin and Ethereum positions. The speed of the move showed that leverage had returned to the market after weeks of caution.
Despite the sharp move lower, the sell-off remained contained. Bitcoin price found support above $90,000, and selling pressure faded without turning into a deeper breakdown.
CLARITY Act Stalls as Institutional Interest in Tokenization Grows
Several policy and institutional developments also influenced the broader market outlook. In the United States, progress on the CLARITY Act slowed after disagreements between Coinbase and the White House over stablecoin yield provisions. Any delay lowers expectations for near-term clarity around federal crypto rules.
Interest from major financial institutions and global markets continued to show through. Goldman Sachs confirmed ongoing work on tokenization and stablecoin systems.
In Asia, South Korea approved amendments that establish a legal framework for tokenized securities. Meanwhile, the New York Stock Exchange said it is exploring 24/7 trading through tokenized infrastructure. This signals growing attention to around-the-clock markets.
Key Events to Watch This Week
Market attention is shifting toward a packed global calendar that could shape near-term price action. Tuesday’s U.S. market reopening after the MLK holiday will test whether Bitcoin can hold recent lows.
At the same time, the World Economic Forum week brings added headline risk, with Trump attending Davos for the first time in six years. Comments around trade policy and U.S. foreign relations could move markets as the week unfolds.
Later in the week, an EU emergency summit on Thursday will address the proposed tariffs. Markets are watching closely for signs of escalation or compromise. On Friday, the Core PCE report, the Federal Reserve’s preferred inflation gauge, will set expectations ahead of February’s FOMC meeting.
Alongside this, a pending Supreme Court ruling on tariff authority remains a background risk, with the potential to add volatility across global markets. For now, Bitcoin’s ability to stay in the low $90,000 range remains the key test.
Holding that area alongside continued ETF inflows would keep the recent breakout intact. However, a sustained drop below $90,000 could push prices back into the November range and delay further upside.