After a promising start to 2025, crypto and financial markets have become more volatile, impacted by strong jobs data in the US and diminished hopes for interest rate cuts. Investors' appetite for risk-based assets has waned, both in crypto and traditional finance.
Towards the end of last week, cryptocurrencies such as Bitcoin and Ethereum experienced larger price drops, having started the week up. But also US stocks have fluctuated strongly and Wall Street ended the week with a bigger fall. The reason for the increased uncertainty is strong jobs data in the US which has strengthened the dollar and thereby reduced hopes for interest rate cuts.
Bitcoin started the week strongly with a rise to $102,000 on Monday, January 6, driven by optimism following MicroStrategy's latest acquisition. Beyond the week, the price fell sharply, reaching a low of $91,200 on Friday, January 10. As of Sunday, January 12, Bitcoin is trading around $94,300, a weekly decline of roughly 4%.
The U.S. stock market experienced significant volatility in the week from January 6 to 10, 2025, with major indexes fluctuating due to mixed economic data and investor sentiment. The Dow Jones Industrial Average closed down about 1.6% on Friday, January 10th, while the S&P 500 fell by about 1.5%, and the Nasdaq Composite dropped about 1.6%.
Recent inflows into money market funds have amounted to $143 billion, reflecting a significant shift as investor confidence fades amid rising inflation and reduced expectations of interest rate hikes from the Federal Reserve. The market is now pricing in only two rate hikes for 2025, down from six that were expected in September. As a result, funds in US money market funds have reached a record high.
During the first week of 2025, CoinShares reported a strong start for crypto-based ETFs, with a total inflow of $585 million in the first three days. However, the trend reversed in week two, as Blackrock's Bitcoin ETF experienced significant outflows. This indicates a growing concern among investors despite the strong start earlier in January.
In 2025, MicroStrategy has purchased an additional 2,138 Bitcoin for $101 million, increasing their total holdings to 447,470 Bitcoin. The company has also planned to bring in $2 billion in new capital to fund future Bitcoin purchases. Its stock price has been volatile and was trading at $327.91 per share on January 12, 2025, after falling nearly 25% from its peak level of $540 in November 2024.
Among cryptocurrencies, Ethereum has suffered an even sharper decline than Bitcoin this week, with a drop of around 10%. After starting the week near $3,600, Ethereum is now trading around $3,265. Altcoins have also experienced significant price declines this week, with broad declines in the market.
AI agents have been a major topic of conversation in the crypto world in recent weeks, with NVIDIA chief Jensen Huang which predicts they could become a “multi-trillion-dollar” industry. New AI agents are launched daily and the interest in the sector is huge after there is now an ongoing increased integration between AI and crypto. Despite this, the prices of many crypto-based AI agents have dropped significantly after the New Year, often more than traditional altcoins, which is neither unusual nor unexpected for an entirely new asset class.
Investors should, according to experts, in the future focus on risk management in the face of continued volatility and monitor key indicators such as the dollar exchange rate and regulatory signals. Technical analysis points to key support levels for both Bitcoin and Ethereum that could provide indications of the market's direction over the next few days. Investors and analysts are also excited about how the inauguration of Donald Trump as president on January 20 and the departure of SEC chief Gary Gensler, also on January 20, will pan out in the short and medium term.
After a promising start to 2025, crypto and financial markets have become more volatile, impacted by strong jobs data in the US and diminished hopes for interest rate cuts. Investors' appetite for risk-based assets has waned, both in crypto and traditional finance.
Towards the end of last week, cryptocurrencies such as Bitcoin and Ethereum experienced larger price drops, having started the week up. But also US stocks have fluctuated strongly and Wall Street ended the week with a bigger fall. The reason for the increased uncertainty is strong jobs data in the US which has strengthened the dollar and thereby reduced hopes for interest rate cuts.
Bitcoin started the week strongly with a rise to $102,000 on Monday, January 6, driven by optimism following MicroStrategy's latest acquisition. Beyond the week, the price fell sharply, reaching a low of $91,200 on Friday, January 10. As of Sunday, January 12, Bitcoin is trading around $94,300, a weekly decline of roughly 4%.
The U.S. stock market experienced significant volatility in the week from January 6 to 10, 2025, with major indexes fluctuating due to mixed economic data and investor sentiment. The Dow Jones Industrial Average closed down about 1.6% on Friday, January 10th, while the S&P 500 fell by about 1.5%, and the Nasdaq Composite dropped about 1.6%.
Recent inflows into money market funds have amounted to $143 billion, reflecting a significant shift as investor confidence fades amid rising inflation and reduced expectations of interest rate hikes from the Federal Reserve. The market is now pricing in only two rate hikes for 2025, down from six that were expected in September. As a result, funds in US money market funds have reached a record high.
During the first week of 2025, CoinShares reported a strong start for crypto-based ETFs, with a total inflow of $585 million in the first three days. However, the trend reversed in week two, as Blackrock's Bitcoin ETF experienced significant outflows. This indicates a growing concern among investors despite the strong start earlier in January.
In 2025, MicroStrategy has purchased an additional 2,138 Bitcoin for $101 million, increasing their total holdings to 447,470 Bitcoin. The company has also planned to bring in $2 billion in new capital to fund future Bitcoin purchases. Its stock price has been volatile and was trading at $327.91 per share on January 12, 2025, after falling nearly 25% from its peak level of $540 in November 2024.
Among cryptocurrencies, Ethereum has suffered an even sharper decline than Bitcoin this week, with a drop of around 10%. After starting the week near $3,600, Ethereum is now trading around $3,265. Altcoins have also experienced significant price declines this week, with broad declines in the market.
AI agents have been a major topic of conversation in the crypto world in recent weeks, with NVIDIA chief Jensen Huang which predicts they could become a “multi-trillion-dollar” industry. New AI agents are launched daily and the interest in the sector is huge after there is now an ongoing increased integration between AI and crypto. Despite this, the prices of many crypto-based AI agents have dropped significantly after the New Year, often more than traditional altcoins, which is neither unusual nor unexpected for an entirely new asset class.
Investors should, according to experts, in the future focus on risk management in the face of continued volatility and monitor key indicators such as the dollar exchange rate and regulatory signals. Technical analysis points to key support levels for both Bitcoin and Ethereum that could provide indications of the market's direction over the next few days. Investors and analysts are also excited about how the inauguration of Donald Trump as president on January 20 and the departure of SEC chief Gary Gensler, also on January 20, will pan out in the short and medium term.
