Bitcoin Falls Below $78,000 in January Amid Risk-Off Macro Backdrop and Political Tensions

Stay up to date with our monthly market commentary:

• Bitcoin drops below $78,000 amid macroeconomic and political tensions. 
• Morgan Stanley joins the ranks of banks offering digital asset exposure with new spot ETPs. 
• Bitcoin (BTC) closed the month down over 12.1%, while Ether (ETH) is down over 25.5% versus last month.*

Market Overview - January 

The price of Bitcoin (BTC) dropped by over 12.1% in January, closing at approximately $77,000*. 

Despite this month’s closing price levels, the year began with notable strength, with BTC rallying to $94,420 by January 5, supported by reports of expanding institutional adoption in the U.S. 

The rally continued into the second week of January, where Bitcoin reached an intraday high of over $97,000. 

However, market sentiment shifted mid-month after the U.S. administration announced a proposed 10% tariff on eight European nations, a move linked to negotiations on the Arctic and Greenland. This geopolitical friction coincided with a sharp reversal in BTC price.

Volatility remained high throughout the second half of January. The reversal of tariff threats on 21 January, following a "framework agreement" between the U.S. and NATO in the ongoing Greenland negotiations, provided a brief reprieve.

However, Bitcoin faced renewed pressure in the final week of January as risk-off sentiment intensified across markets. Spot Bitcoin ETFs recorded net outflows, while capital rotated into surging precious metals, with gold briefly touching $5,600 and silver hitting $120.

A broader equity selloff, triggered in part by disappointing tech earnings, added to the downward pressure.

Crypto Asset Market Performance Review 

The crypto asset market ended January in the red, weighed down by geopolitical and macroeconomic pressures, with several major coins declining by more than 20%.

Bitcoin (BTC) finished the month down 12.1% from its December close, while Ether (ETH) dropped by 25.5%, and other popular crypto assets saw even larger corrections. 

Ripple (XRP), Solana (SOL), and Dogecoin (DOGE) ended the month in the red, with declines of 19.3%, 20.7%, and 25.8%, respectively. 

Two large-cap crypto assets that decreased the least in price this month were Tron (TRX) and the Leo Token (LEO), dropping by only 1.6% and 6.5%, respectively. Despite the price decrease this month, the Leo token has recovered by more than 40% from its December low. 

Institutional Interest in Bitcoin

Despite Bitcoin's price dropping below $77,000, institutional interest in digital assets hasn’t waned. Case in point, Morgan Stanley filed for Spot Bitcoin and Solana ETPs and is building out its crypto division with a new head of digital asset strategy.  

Morgan Stanley Filed for Spot Crypto ETPs and Appointed a New Head of Crypto

Morgan Stanley is the latest bank in the U.S. to join the ranks of offering spot ETP products tracking digital assets. It announced the application on 6 January through a press release and said: 

"The Morgan Stanley Bitcoin Trust and Morgan Stanley Solana Trust are pending regulatory approval and would be passive investment vehicles that seek to track the performance of the price of the relevant cryptocurrency."

There is no confirmation yet on whether the bank will be the custodian of the underlying assets for both ETPs or whether they will use a third party. However, it's another strong signal that a U.S. bank is entering the digital asset market and seeking to offer clients exposure to these assets. 

What’s more, Morgan Stanley appointed veteran executive Amy Oldenburg as the new head of digital asset strategy, as part of the Wall Street bank’s expansion into digital assets. 

Bitcoin on Balance Sheets

Strategy, the largest publicly traded holder of Bitcoin, continued its efforts to buy Bitcoin as a strategic reserve asset. In January, the company purchased 40,150 BTC, bringing its total balance sheet holdings to 712,647 BTC.

Strive Asset Management, a publicly traded company on the NASDAQ, completed its merger with Semler Scientific and, as a result, added 5,606.82 BTC to its balance sheet. The company currently holds 13,132 BTC in its treasury. 

Cango Inc., a U.S.-listed company headquartered in China, is one of the latest companies to acquire Bitcoin in January. In total, the leading automotive transaction service provider acquired 454,2 BTC and currently holds 7,874  BTC on its balance sheet. 

American Bitcoin Corp, a publicly traded U.S. company, acquired 755 BTC in January, bringing its total balance sheet holdings to 5,843 BTC.

‍*Closing price data is from January 31st 2026, at 23:45 CET

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