Bitcoin briefly dipped below $100,000 early Monday as a global technology stock sell-off rattled markets to start the week.
The largest cryptocurrency by market capitalization was down 3.51% as of Monday morning, bringing its price to $101,295 apiece. That was a recovery from a low of about $97,900 earlier in the day.
Bitcoin has been boosted in recent months by President Donald Trump’s return to the White House, which first sent the popular coin above $100,000 last month in the aftermath of his election victory. Last week, Trump signed an executive order that set the stage for industry-friendly regulations and a national cryptocurrency stockpile — key campaign promises he made to the industry.
But Bitcoin isn’t immune from other market turmoil. Contracts for all three major U.S. indices fell tumbled Monday morning as a perceived threat from Chinese artificial intelligence startup DeepSeek prompted a global sell-off of tech stocks.
Futures of the tech-heavy Nasdaq plunged more than 800 points, or roughly 4%. Dow Jones Industrial Average futures, an index of 30 of the largest U.S. companies including Nvidia (NVDA-3.33%), were also down more than 300 points as of Monday morning. S&P 500 futures tumbled 2%.
The sell-off was prompted by DeepSeek’s announcement last week that it launched a model rivaling OpenAI’s ChatGPT and Meta’s (META+1.48%) Llama 3.1 built using lower capability chips from Nvidia, which could put pressure on the semiconductor darling if other firms move away from its premium offerings.
In December, the private company launched a free, open source large language model (LLM), which it claimed it had developed in just two months for less than $6 million.
Analysts at Wedbush said in a research note Monday that “tech stocks are under massive pressure led by Nvidia as the Street will view DeepSeek as a major perceived threat to U.S. tech dominance and owning this AI Revolution.”
Investors are also awaiting the Federal Reserve’s upcoming interest rate decision on Wednesday. Fed policymakers are expected to hold rates steady following this week’s meeting, according to the CME FedWatch tool.
The Fed reduced rates by a full percentage point in the span of three months last year, bringing the benchmark federal funds rate to 4.25%-4.50%. Fed Chair Jerome Powell signaled a more cautious approach to interest rates this year, as concerns about balancing rising inflation with the strong labor market persist.
“As for additional cuts, we’re going to be looking for further progress on inflation as well as continued strength in the labor market,” Powell said in a news conference following the committee’s December meeting. “And as long as the economy and the labor market are solid, we can be cautious as we consider further cuts.”
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