Bitcoin Drops Below $90K as Crypto Stocks Tank

Cryptocurrency markets entered a sharp risk-off phase on January 20, 2026, with Bitcoin briefly trading below $90,000—its lowest level since mid-December 2025. The sell-off accelerated after Bloomberg and Reuters reported that President Trump is preparing a new round of tariffs targeting China, the European Union, Mexico, Canada, and potentially India, with some levies rumored as high as 60% on certain goods.The move—labeled “Trump trade war 2.0” by traders—sparked a broad flight from risk assets. Crypto was especially hard hit due to its high-beta status:Bitcoin: -7.8% intraday, low of $89,200 before partial recovery to ~$91,500. Ethereum: -9.2%, dipping under $3,800. Altcoins: Solana (-11%), Cardano (-13%), Dogecoin (-14%), and most memecoins down 15–30%. Crypto Stocks:MicroStrategy (MSTR): -14.6% Coinbase (COIN): -12.1% Marathon Digital (MARA): -15.3% Riot Platforms (RIOT): -13.8% CleanSpark (CLSK): -16.2% The correlation between crypto and equities strengthened during the session, with the Nasdaq 100 falling ~2.8% and the S&P 500 down ~2.1%. The U.S. Dollar Index (DXY) jumped above 109, adding further pressure on dollar-priced assets like Bitcoin.Key Drivers Behind the DropTrade War Escalation Fears — Trump’s comments about “reciprocal tariffs” and reports of imminent executive orders renewed worries of global supply-chain disruption, inflation spikes, and slower growth—classic risk-off triggers. Leverage Flush — High funding rates and over-leveraged long positions in crypto futures were liquidated en masse, amplifying the move. Macro Rotation — Money flowed into Treasuries (10-year yield dropped to 4.32%) and the dollar, starving risk assets of liquidity. Sentiment Shift — The “Trump put” narrative—that his administration would be unequivocally pro-crypto—took a hit as trade protectionism overshadowed deregulation hopes. Analysts note that while crypto has benefited enormously from Trump’s pro-Bitcoin rhetoric since 2024, it remains highly sensitive to broader risk sentiment. A prolonged trade conflict could delay ETF inflows, slow institutional adoption, and pressure miners’ margins if energy costs rise.At digital8hub.com, we cover crypto markets 2026, Bitcoin price analysis, trade policy impact, investment risk, and blockchain trends. For guides on hedging crypto volatility, using stop-loss strategies, or tracking macro indicators that move BTC, explore our finance and tech sections.Today’s dip is sharp—but crypto has seen worse. Whether this is a healthy correction or the start of a deeper drawdown depends on how far Trump pushes the tariff envelope in the coming days.