Bitcoin Price Analysis: BTC Dips Below $88,000 As Shutdown Fears, Fed Rate Cut Decision Weaken Market Sentiment
Bitcoin (BTC) dipped below $88,000 on Sunday as selling pressure returned ahead of the Federal Reserve’s first rate cut decision of 2026 and the risk of another government shutdown. The decline extends the recent pullback that has left BTC and tokens trading in the red as macro and geopolitical tensions persist.
The flagship cryptocurrency traded above $88,000 for most of the weekend but lost momentum late on Sunday/early Monday, dropping to a low of $86,000 before settling at $86,561.
$100 Billion Wiped From Crypto Market
The cryptocurrency market saw nearly $100 billion wiped out late on Sunday as uncertainty around another US government shutdown saw traders pull out from risk assets. Senate Democrats have threatened to block a new funding package if it includes money for the Department of Homeland Security, which oversees Immigration and Customs Enforcement (ICE), after federal agents shot and killed a Minneapolis man on Saturday. Senate Democrat leader Chuck Schumer stated,
“Democrats sought common-sense reforms in the Department of Homeland Security spending bill, but because of Republicans’ refusal to stand up to President Trump, the DHS bill is woefully inadequate to rein in the abuses of ICE. I will vote no. Senate Democrats will not provide the votes to proceed to the appropriations bill if the DHS funding bill is included.”
According to bettors on prediction markets, including Kalshi and Polymarket, the odds of a US government shutdown have reached 80%.
Gold Continues Divergence, Reaches New High
Gold prices crossed $5,000 amid rising geopolitical and trade tensions, while Bitcoin (BTC) languished around $87,000 as the divergence between them widened. Gold rallied to a fresh record of $5,080 on Monday as traders sought refuge in the precious metal amid the potential for yet another government shutdown. The Kobeissi Letter stated in a post on X,
BREAKING: Silver surges above $106/oz for the first time in history, now up another +48% in 2026. A likely government shutdown just added fuel to the fire for precious metals.
Meanwhile, trade tensions have escalated again after President Trump threatened Canada with 100% tariffs over its trade deal with China. BTC’s latest decline means it has erased all the gains made this year, as it trades 30% below its October record of $126,000. As gold continues surging to new highs, the divergence between the two assets widens.
Columbia’s Second-Largest Pension Fund To Offer Bitcoin Exposure
Columbia’s second-largest private pension fund and severance manager plans to launch an investment fund with exposure to Bitcoin. Juan David Correa, president of Protección SA, confirmed plans for a limited-access investment fund. Correa stated that customers can access the product only through a personalized advisory process that assesses each investor’s risk profile. Only customers who meet a specific criterion will be allowed to allocate their portfolio to Bitcoin. Correa stated,
The most important element is diversification. Those who can participate will find a space for a percentage of their portfolio, if they so wish, to be exposed to this type of asset.
Bitcoin (BTC) Price Analysis
Bitcoin’s (BTC) downturn intensified late on Sunday as market sentiment worsened ahead of the Federal Reserve’s first rate cut decision of 2026, and rising concerns about another government shutdown. The flagship cryptocurrency fell nearly 3% on Sunday, wiping out all the gains made this year as it trades 30% lower than its October peak.
The decline liquidated over $224 million in bullish bets over the past 24 hours, with $68 million on Bitcoin-tracked futures. Markets enter the new week watching for signs of a possible intervention in the Japanese Yen after Prime Minister Sanae Takaichi warned against “abnormal” market moves after a sudden reversal in the yen’s value late on Friday. The rally put Asian markets on alert. However, officials have not confirmed any action. Political developments in the US have added further uncertainty, with Senate Democratic leader Chuck Schumer stating that the Democrats would block funding for the Department of Homeland Security, which oversees Immigration and Customs Enforcement (ICE).
The week ahead also includes earnings results from several megacap technology firms, including Microsoft, Meta Platforms, Tesla, and Apple, part of the Magnificent 7 tech giants. Investors and market watchers will look for cues on how earnings trends can shape AI-related results. The Federal Reserve’s FOMC meeting will also be in focus, with the Fed widely expected to hold interest rates steady.
BTC ended the previous weekend in the red, dropping 1.55% to $93,633. Sellers retained control on Monday as the price fell 1.15% to $92,559. Selling pressure intensified on Tuesday as BTC fell nearly 5%, slipping below $90,000 to $88,310. Despite the overwhelming bearish sentiment, the price recovered on Wednesday, rising 1.19% to $89,363. BTC registered a marginal increase on Thursday, moving to $89,463.
Source: TradingView
BTC experienced considerable volatility on Friday as buyers and sellers struggled to establish control. Buyers ultimately gained the upper hand as the price registered a marginal increase to $89,474. Selling pressure returned over the weekend, and BTC fell 0.44% to $89,092. Selling pressure intensified on Sunday as the price fell nearly 3% to $86,561. BTC is up 1.16% during the ongoing session, trading around $87,561.
Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.
Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.