On Tuesday, Bitcoin (BTC) experienced a remarkable rise, approaching $103,000, leading to an influx of gains across the cryptocurrency market. This surge comes in the wake of significant developments stemming from China’s DeepSeek, which sparked a steep decline in U.S. indexes on Monday due to concerns surrounding overvaluations of artificial intelligence investments.
XRP emerged as a notable performer among major cryptocurrencies, soaring by 12%. Other top contenders such as Cardano’s ADA, BNB Chain’s BNB, Solana’s SOL, and dogecoin (DOGE) recorded impressive gains of up to 9%. Ether (ETH) followed suit with a 4.5% increase, contributing to an overall market capitalization rise of 3%.
In the past 24 hours, Bitcoin climbed nearly 4%, partially recovering from a tumultuous Monday that saw over $1 billion in futures liquidations and an 8.5% dip in the CoinDesk 20 (CD20) at its lowest point.
Historically, substantial liquidation events often present buying opportunities, as highlighted by CoinDesk, indicating that an overstretched market has likely corrected itself. In this context, the TRUMP tokens outshined mid-cap cryptocurrencies, skyrocketing by 12%.
The positive momentum among major cryptocurrencies is also attributed to Tuttle Capital’s filing for the first-ever 2x leveraged ETFs in the U.S. on Monday. These products promise to deliver 200% of the daily price performance across nearly all major tokens, alongside smaller tokens like BONK, TRUMP, and MELANIA.
DeepSeek’s breakthrough, which was primarily responsible for Monday’s market downturn, demonstrated its AI model outperforming tech giant OpenAI’s at a fraction of the cost and GPU resources. This event, although unsettling for some investors, has spurred discussions regarding its potential implications on the crypto market.
Nick Ruck, director at LVRG Research, mentioned in a Telegram update that while initial concerns surrounding DeepSeek presented a buying opportunity for crypto, it isn’t likely to directly compete with the industry. Instead, cryptocurrency project founders may integrate DeepSeek’s open-sourced model to enhance their technological efficiency and innovate further.
However, Ruck cautions that the market may still face volatility in the near term due to anticipated macroeconomic data releases from U.S. agencies this week, such as the Federal Open Market Committee (FOMC) meetings and earnings reports from major corporations including Apple and Meta. Yet, Ruck’s long-term outlook for Bitcoin remains optimistic, as favorable policies are shaping up for the growth of the crypto industry in both the United States and globally.
As traders look ahead to the two-day FOMC meeting scheduled for January 28-29, expectations are set against a backdrop of no indications of a rate cut. Such financial decisions traditionally influence Bitcoin’s market behavior as investors either seek increased risk or retreat to safer assets.
Additionally, QCP Capital from Singapore offered a unique perspective in their Tuesday market update, suggesting astrological insights could guide traders as they face market fluctuations. They noted, “As we approach the Year of the Snake, the market’s twists and turns remind us of the wisdom, adaptability, and resilience this zodiac symbolizes – qualities that will be essential as we navigate 2025’s challenges and opportunities.”
Indeed, as reported by CoinDesk, Bitcoin thrived during the preceding Chinese Year of the Dragon, showcasing its profitability for bullish investors. Nonetheless, market experts are cautious of forthcoming shifts and advocate for preparedness in light of unpredictable events that could lead to new highs.
