Bitcoin fell on Tuesday, continuing its recent decline as risk appetite, particularly for speculative crypto assets, remained weak ahead of several key US economic readings.
Cryptocurrency prices have largely tracked the extended decline in global technology stocks, as questions surrounding artificial intelligence have led markets to lock in recent gains in the sector. Losses in the technology sector have also dampened appetite for cryptocurrencies and other high-risk assets.
Bitcoin fell 4% to $85,987.9 by 8:35 AM Saudi time, nearing its weakest level in two weeks. The cryptocurrency also remained close to its seven-month low reached in late November.
Bitcoin falls as sentiment deteriorates ahead of jobs data
Bitcoin has steadily lost ground over the past week, with little support from the Federal Reserve's interest rate cut and its dovish outlook on monetary policy.
Risk appetite remained weak as traders awaited data that could influence the Federal Reserve's plans. The November non-farm payrolls report is due later on Tuesday, followed by the consumer price index (CPI) inflation data on Thursday.
The labor market and inflation are the Federal Reserve's two most important considerations for changing policy, as any signs of weakening jobs and declining inflation are likely to increase expectations of an interest rate cut.
Such a scenario could help Bitcoin regain some lost ground, given that lower interest rates boost the appeal of speculative assets like cryptocurrencies.
The Federal Reserve also began repurchasing short-term Treasury bonds last week, increasing market liquidity and potentially opening the door to more trading in speculative assets like cryptocurrencies. Extremely low interest rates and the Fed's liquidity measures—sometimes called quantitative easing—were key drivers of the cryptocurrency rally in 2021.
Cryptocurrency prices today: Altcoins follow Bitcoin's losses
Prices for the broader cryptocurrency market have fallen widely, with all major altcoins tracking the weakness in Bitcoin.
Ether, the world's second-largest cryptocurrency, fell 6.33% to $2,922.06, while XRP declined by about 6% to $1.8817.
Solana and Cardano fell by 4.2% and 5.7% respectively, while BNB lost 3.7%.
Among the meme currencies, Dogecoin fell by 5.7%, while $TRUMP declined by 4.2%.
Most alternative currencies were near their lowest levels in several months, affected by the extended sell-off in cryptocurrency markets.
Bitcoin and other cryptocurrencies have largely erased their gains for 2025, trading in negative territory for the year after an extended price collapse since mid-October, which has shown few signs of easing.
