5 Reasons Why Bitcoin Price Could Plummet This Week
Jakarta, Pintu News – Bitcoin prices are expected to plummet this week, while gold prices continue to set record highs. BTC is now facing a number of pressures, including the Fed’s monetary policy decision, outflows from spot ETFs, stablecoin liquidity tightening, and crypto option maturities.
This comes after Bitcoin failed to hold at the $90,000 level, amid tariff-related concerns and a potential US government shutdown.
Bitcoin price drops and gold rises amid declining stablecoin liquidity
Bitcoin’s price is moving in the opposite direction of gold, driven by demand for safe havens amid economic uncertainty, continued inflation, and geopolitical risks. A report from Matrixport states that capital is now moving away from stablecoins to traditional safe-haven assets such as gold and silver.
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The decline in stablecoin supply has led Circle to shift its focus to transaction speed. USDC issuers are now prioritizing real-world use, such as through the Circle Payment Network and partnerships with companies like Intuit.
Matrixport also added that the GENIUS Act, which prohibits stablecoin issuers from providing returns to holders, will further tighten liquidity and reduce inflows into the crypto market.
Notably, USDC has redeemed $6.5 billion in the last six weeks. Without new liquidity driven by stablecoins, Bitcoin price is at risk of further selling pressure.
In addition, a possible US government shutdown this week could delay the passage of the CLARITY Act. This could tighten liquidity and increase selling pressure on Bitcoin prices.
FOMC Meeting and Hawkish Signals from the Fed
The Fed is widely expected to pause interest rate cuts in the FOMC meeting taking place today. The CME FedWatch tool shows that there is a 97% chance that the Fed will keep interest rates in the range of 3.5%-3.75%. This poses a downside risk to Bitcoin prices as the halt in cuts reduces expectations for liquidity injections in the near future.
Bitcoin and crypto traders will be watching the Fed’s monetary policy outlook and Jerome Powell’s press conference for clues regarding the timing of the next interest rate cut. Interestingly, the chances of a rate cut by the Fed in June increased ahead of the FOMC meeting.
However, JPMorgan expects no rate cuts in 2026, as strong GDP and employment data point to the resilience of the US economy.
Even so, US President Donald Trump on Tuesday said that the Fed will lower interest rates after he announces Jerome Powell’s successor as Fed Chair.
Yen Strengthens against US Dollar
The Japanese yen strengthened against the US dollar in recent sessions, amid speculation of possible intervention from the US and Japan. At the time of writing, the yen was trading at its highest level in three months, around 152.58 per dollar on Wednesday.
A strengthening yen could prompt hedge funds and other institutional investors to abandon yen carry trade strategies. In this strategy, investors borrow in yen at low interest rates to invest in higher-risk, higher-yielding assets, such as Bitcoin and other cryptocurrencies. When the yen strengthens, this often triggers forced liquidation and risk reduction, potentially causing Bitcoin prices to plummet.
While a weaker dollar may encourage investment into Bitcoin, traders will be watching the short-term impact of canceling the carry trade. Donald Trump’s positive comments on the weakness of the US dollar as well as the Bank of Japan’s signals that it is considering further interest rate hikes also strengthened the yen today.
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Bitcoin price weakens amid ETF outflows
Spot Bitcoin ETFs have experienced massive outflows, with billions of dollars in withdrawals in recent times. In particular, the net outflow of nearly $1.5 billion indicates negative sentiment from institutional investors.
On Tuesday, Bitcoin ETFs recorded net outflows of $147 million. BlackRock’s Bitcoin ETF (IBIT) recorded withdrawals of $102.8 million, while Fidelity’s FBTC ETF saw outflows of $44.6 million. Capital is now moving from crypto to stocks, precious metals, or cash.
Large outflows from ETFs reduce buying pressure in the spot market and increase the potential for liquidation of leveraged positions, especially amid thin futures liquidity. BlackRock itself is developing the iShares Bitcoin Premium Income ETF to bring yield potential to Bitcoin investments.
$8.5 Billion in Bitcoin Options to Expire
Bitcoin options worth $8.5 billion will expire on Friday, with a put-call ratio of 0.56. However, traders are bracing for volatility, with implied volatility dropping to October levels of 37.81.
Bitcoin’s max pain price was recorded at $90,000. In the past 24 hours, put volume exceeded call volume, with a bearish put-call ratio of 1.04. Amid gloomy macro conditions, options traders expect the dominance of downside protection and liquidation.
Veteran trader Peter Brandt also issued a new sell signal for Bitcoin price, stating that the bear channel pattern has finished forming. He predicts that Bitcoin price could plummet to $81,833, but if Bitcoin is able to return to the $93,000 level, the prediction could be canceled.
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*Disclaimer
This content aims to enrich readers’ information. Pintu collects this information from various relevant sources and is not influenced by outside parties. Note that an asset’s past performance does not determine its projected future performance. Crypto trading activities are subject to high risk and volatility, always do your own research and use cold hard cash before investing. All activities of buying and selling Bitcoin and other crypto asset investments are the responsibility of the reader.
Reference:
- Coingape. 5 Reasons Why Bitcoin Price Could Crash This Week. Accessed on January 29, 2026
