Bitcoin fell below $100,000 on Tuesday for the first time since June, as investors grew cautious amid doubts over the high valuations of AI-driven stocks. It briefly dropped to $99,966 before recovering slightly to $100,893, down 5% on the day. Ether also took a hit, falling nearly 9% to $3,275.
The close link between cryptocurrencies and AI stocks was apparent as the Nasdaq Composite, home to many AI firms, slid more than 1%. Palantir, known for its data analytics and AI ties, saw shares drop despite strong earnings, driven by concerns over its valuation.
“Bitcoin and the broader crypto market is exhausted,” said Haonan Li, founder of the Ethereum stablecoin Codex. “Even with stablecoin growth, rising [real-world asset] volumes, and Bitcoin increasingly behaving like an institutional store of value — the market doesn’t care. Bad news is very bad for crypto right now … and good news barely moves the needle.”
Compass Point analyst Ed Engel noted that retail investors are less active in buying dips compared to past cycles. “While selling from Long-term Holders is a common feature in bull markets, retail spot buyers have been less engaged than prior cycles,” he said.
Engel warned of further downside if short-term holders also sell but identified support around $95,000, noting few near-term catalysts for a rebound.
Bitcoin’s price decline defied October’s usual seasonal strength, with the last similar pattern seen in 2018 before a 37% drop in November. This suggests potential continued volatility as market sentiment shifts amid AI stock uncertainty.