Crypto and AI tokens hit hard as Bitcoin slips below $90,000
- Bitcoin hovers above $91,000 after a brief drop under $90,000 on Monday.
- Altcoins and AI-related tokens corrected heavily, responding to Bitcoin’s price drop.
- AI agent launchpad coins erased nearly 15% from its market capitalization within 24 hours.
- NEAR, ICP, Render and TAO declined between 5 and 7% on the day.
Bitcoin (BTC) lost support at the $90,000 level on Monday, down to a low of $89,256 on the day. Experts analyzed the state of the market, identifying catalysts like macroeconomic developments in the United States (US) and President-elect Donald Trump’s inauguration as the key movers for BTC.
The Artificial Intelligence (AI) category of tokens was the hardest hit, with AI agent launchpad tokens losing nearly 15% of their market cap on Monday.
Why Bitcoin slipped to a low of $90,000
Bitcoin corrected under $90,000 briefly, recovering above $91,000 at the time of writing. The brief decline raised concerns among BTC holders and crypto traders, with the emergence of the "end of Bitcoin bull run" narrative.
James Toledano, chief operating officer at Unity Wallet, suggests FXStreet’s readers bear in mind that Bitcoin and crypto generally is
"a volatile beast over a month, this is all very normal for Bitcoin."
When asked to identify factors behind Bitcoin’s correction, Toledano says:
"As for why it has dropped it could be for a variety of factors, but the following stand out. The first is profit-taking, after hitting a peak of around $108,300 in mid-December, the market has seen a massive amount of it, particularly following the election of pro-crypto President-elect Donald Trump."
"Secondly, while institutional buying has continued contributing to Bitcoin reserves on exchanges hitting a seven-year low, trading volume remains subdued and this could simply be down to a seasonal slow-down," he added.
The Unity Wallet executive highlighted that extended breaks or slow recovery from the holiday season are another factor behind the lack of decisive momentum in the crypto market.
The $100,000 milestone remains a key resistance level for Bitcoin and Toledano considers the impact of macroeconomic factors on the crypto market when explaining the BTC drawdown.
President-elect Trump’s inauguration is scheduled for January 20 and anticipation surrounding the event could lead to short-term volatility for an asset that is already highly volatile.
Altcoins and AI agent tokens lose value rapidly
Typically, a correction in Bitcoin drags down altcoins and the market capitalization of crypto, nearly every dip. CoinGecko data shows that the crypto market cap is down nearly 5% in the past day.
Altcoins ranked in the top 10 tokens have erased between 2% and 7% of their value in the last 24 hours.
Top 10 crypto tokens ranked by market capitalization | Source: CoinGecko
AI agent tokens wiped out nearly 15% of value in the same timeframe. The top 5 tokens in the category, as seen on CoinGecko, suffered double-digit losses in the last 24 hours.
The market capitalization of the sector slipped to $4.413 billion and the 24-hour trade volume hovers around $902.6 million.
Top AI tokens, Near protocol (NEAR), Internet Computer Protocol (ICP), Render (RNDR) and Bittensor (TAO) prices decreased between 5 and 7% in 24 hours.
Author
Ekta Mourya
FXStreet
Ekta Mourya has extensive experience in fundamental and on-chain analysis, particularly focused on impact of macroeconomics and central bank policies on cryptocurrencies.
