Bitcoin’s price touched a peak of $92,000 before slipping back to around $91,800 on Tuesday morning, as market uncertainty swirled following the announcement of a potential Department of Justice investigation into Federal Reserve Chair Jerome Powell. Despite the recent fluctuations, the overall trend shows Bitcoin grappling to sustain higher price levels into early 2026.
The brief rally above the psychological $92,000 mark was tied to Powell’s disclosures regarding legal threats related to the renovation of the Federal Reserve headquarters. He suggested these threats were aimed at pressuring the central bank to lower interest rates—a narrative that could sway the markets if it influences Federal Reserve policy.
Since October 2025, Bitcoin has depreciated by approximately 23%, presenting stark contrast to gold and silver, which have surged to all-time highs. This divergence has caused skepticism among traders regarding Bitcoin’s status as a reliable store of value.
On January 12, Bitcoin spot exchange-traded funds (ETFs) recorded a net inflow of $117 million, turning positive after four consecutive days of net outflows. The resurgence in ETF flows hints at a renewed institutional interest in the digital asset space, yet caution prevails among traders as they eye Bitcoin’s precarious position in the market.
Corporate Buying Fails to Lift Bitcoin Above Key Resistance
In a significant move, Strategy, the firm led by prominent crypto advocate Michael Saylor, announced the purchase of $1.25 billion worth of Bitcoin, acquiring 13,627 BTC at an average price of $91,519 per coin. However, this acquisition has not translated into sustained upward momentum, with Bitcoin struggling to hold above the $94,000 threshold for the past month.
The futures market reflects a cautious sentiment, with the annualized premium, or basis rate, for Bitcoin futures lingering near a neutral 5%. Typically, bullish periods show premiums of at least 10%, signalling a lack of convincing upward momentum in the current market conditions.
Adding to the uncertain landscape, Goldman Sachs has revised its forecasts and no longer anticipates an interest rate cut in March, attributing this to persistent inflation and strong labor market indicators. Criticism has mounted against the Federal Reserve for maintaining elevated interest rates amid inflationary pressures that have remained above the 2% benchmark, particularly over the latter half of 2025.
Geopolitical Tensions and Inflation Data in Focus
As traders prepare for the upcoming U.S. consumer price index (CPI) data for December, expectations are for headline CPI to remain steady at 2.7% annually. Core CPI is forecast to show slight increases. Any signs of ongoing inflation could deter the Federal Reserve from contemplating interest rate cuts, amplifying the market’s reaction.
Compounding the financial landscape, geopolitical tensions are shaking investor confidence. Issues ranging from public unrest in Iran to diplomatic issues between China and Japan have weighed heavily on crypto markets, impacting investor sentiment and leading to discernible shifts in asset allocation.
The U.S. Dollar Strength Index rebounded to 99 after dipping to 96.7 in late November, while the 5-year Treasury yield has remained below 3.8%. This backdrop—combined with a $601 billion fiscal deficit recorded in the final quarter of 2025—paints a complex picture for investors assessing the overall economic climate.
Bitcoin’s price recovered to $91,894 early Tuesday, but trader interest in bullish positions appears weak according to derivatives data. Therefore, with no apparent evidence of a debasement trade despite precious metals rallying, Bitcoin stands at a crucial juncture as it navigates through intertwined economic and geopolitical challenges.
Keep an eye on how the CPI data unfolds and what impact it may have on Bitcoin’s trajectory in the coming days.
