The cryptocurrency market faced a broad-based selloff late Thursday, with risk-off sentiment intensifying during U.S. trading hours. Bitcoin (BTC) saw its price retreat below the psychologically important $106,000 level, marking a 2.5% decline over 24 hours. However, the pain was far more acute in the altcoin market. Major digital assets such as Ether (ETH), Solana (SOL), and XRP (XRP) experienced substantial drops, with losses ranging from 5% to 7%. This downturn in the digital asset space was initially triggered by renewed geopolitical anxieties. According to reports from author @burrytracker, comments from President Trump regarding potential new trade tariffs and escalating tensions with Iran soured investor appetite for risk assets. While U.S. equity markets managed to shrug off the early pessimism and close with minor gains, the crypto market was unable to stage a similar recovery, highlighting a potential decoupling in short-term sentiment between traditional and digital markets.

Bitcoin Price Action Under Macro Pressure

Bitcoin's price trajectory showed significant volatility, reacting to both macroeconomic news and technical levels. The BTC/USDT pair fluctuated within a wide 24-hour range, reaching a high of $108,746 before succumbing to selling pressure and hitting a low of $106,766. The breach of the $105,900 support level, as noted by observers, was a key technical event that signaled further downside potential. Trading volumes for Bitcoin remained relatively subdued, suggesting that while sellers were in control, a full-scale panic had not yet materialized. The key challenge for BTC traders now is to see if support can be re-established above the recent lows. A failure to do so could open the door for a retest of lower support zones, while a decisive move back above $108,000 would be needed to restore bullish confidence.

Altcoins Show Mixed Signals Amidst Selloff

While altcoins suffered steeper losses against the U.S. dollar, their performance against Bitcoin painted a more nuanced picture. Ether, trading around $2,509 on the ETH/USDT pair, navigated a daily range from a low of $2,414 to a high of $2,522. Similarly, Solana's SOL/USDT pair traded at approximately $157, after moving between $149.70 and $159.88. XRP also saw significant volatility, with its USDT pair ranging from $2.16 to $2.32. Interestingly, despite these USD-denominated losses, some altcoins showed relative strength against Bitcoin itself. The ETH/BTC pair, for instance, climbed 3.18% to 0.02333, indicating that capital was rotating from BTC into ETH even as the broader market fell. The SOL/BTC pair also posted a strong gain of 4.15% to 0.001471. This divergence is a critical signal for traders, suggesting that certain altcoin ecosystems are perceived as having stronger fundamentals or short-term narratives than Bitcoin amidst the uncertainty.

US Debt Demand and Fed Policy Implications

The narrative that investors are abandoning U.S. government debt for safe havens like Bitcoin and gold was challenged this week. A U.S. Treasury auction of $39 billion in 10-year notes was met with surprisingly strong demand. According to Exante Data, the auction was oversubscribed by more than 2.5 times, with a high yield of 4.421%. Crucially, the primary dealer takedown was a mere 9%, one of the lowest on record, signifying robust buying from direct and indirect investors rather than banks being forced to absorb the supply. This strong uptake complicates the macro case for an imminent capital flight from U.S. debt. Simultaneously, weakening economic indicators, including a softer-than-expected Producer Price Index and a third consecutive rise in continuing jobless claims to 1.956 million, could pressure the Federal Reserve to consider a more dovish monetary policy. Any pivot towards rate cuts would likely be a significant long-term tailwind for scarce assets like Bitcoin.

Looking ahead, the market remains on edge, with an upcoming auction of $22 billion in 30-year bonds serving as the next major test of investor confidence in U.S. fiscal stability. The backdrop is a worsening debt situation, with the total national debt exceeding $36 trillion, or over 120% of GDP. The long-term thesis for Bitcoin as a hedge against fiscal irresponsibility and currency debasement remains intact for many investors. While the strong demand for 10-year notes shows that U.S. debt is still considered a premier safe asset in the short term, the underlying fiscal pressures continue to build. For crypto traders, this creates a complex environment: navigating short-term price action driven by geopolitical news and traditional market flows, while keeping an eye on the long-term macroeconomic trends that could ultimately propel the next major bull cycle for Bitcoin and the broader digital asset class.