Bitcoin’s (CRYPTO:BTC) recent recovery attempt stalled after the price was rejected near the $90,000 level, triggering almost $100 million in liquidations across leveraged positions.
The pullback reinforced concerns that Bitcoin lacks the momentum needed to reclaim the $100,000 mark amid shifting global risk sentiment.
Traders have increasingly turned to traditional hedges such as gold and US government bonds, putting pressure on Bitcoin’s digital gold narrative.
Gold prices held above $4,300, while yields on the two-year US Treasury fell to their lowest level since August 2022, signalling heightened demand for government-backed assets.
Rising appetite for bonds reflects broader risk aversion, particularly as the US fiscal deficit is projected to widen sharply in 2026.
The US Treasury is also facing the challenge of refinancing close to $10 trillion in debt over the year, adding to uncertainty in global markets.
We’re in this age of financial repression with governments using various tools to artificially keep a lid on bond yields.
Jimmy Chang said.
Analysts noted that concerns over US import tariffs have been partially offset by heavy spending on artificial intelligence infrastructure, easing immediate growth fears.
Investor confidence weakened further after the US unemployment rate rose to 4.6% in November, its highest level in four years.
Under typical conditions, weaker labour data would fuel expectations of aggressive rate cuts, but persistent inflation risks have limited that outlook.
Despite economic uncertainty, the S&P 500 climbed to a fresh all-time high in December, drawing capital away from alternative hedges like Bitcoin.
Lower interest rates tend to support equity valuations by reducing corporate borrowing costs and improving consumer credit conditions.
This environment has made Bitcoin’s role as an independent hedge less attractive compared with equities and bonds.
Bitcoin’s struggle to hold above $90,000 highlights ongoing doubts about its reliability as a store of value during periods of economic stress.
Attention has also shifted to Bitcoin mining, as higher energy costs squeeze margins and strain miners’ cash flows.
Some miners have increasingly relied on debt and equity-linked financing, including secondary share offerings, to remain liquid.
The Bitcoin network hash rate has edged lower since peaking in late October, raising concerns about miner capitulation.
VanEck analysts argue that miner capitulation has historically acted as a bullish contrarian signal for Bitcoin prices.
Bitcoin’s 90-day forward returns have historically been positive 65% of the time following 30-day periods of network hashrate decline.
Matt Sigel said.
The recent decline in hash rate has been linked to the shutdown of roughly 1.3 gigawatts of mining capacity in China.
Valuation pressure has also emerged among digital reserve asset companies, reducing incentives to issue new shares.
Strategy and Twenty One Capital have both traded at notable discounts to the value of their Bitcoin holdings, reflecting investor caution.
Analysts say Bitcoin’s longer-term direction depends on a clear shift in risk perception back towards the digital gold narrative.
That shift may take time as markets remain focused on global growth risks, equity performance and monetary policy uncertainty.
At the time of reporting, Bitcoin price was $87,895.61.