Bitcoin Drops Below $90,000 as AI-Sector Worries Shake Global Risk Appetite

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Global financial markets witnessed renewed turbulence on Thursday as cryptocurrencies slid sharply, led by a sudden dip in Bitcoin, which briefly fell below the significant $90,000 mark. The decline reflected investors’ growing nervousness in the face of fresh concerns about artificial intelligence (AI)–related profitability, fears that also weighed heavily on global technology stocks.

The sell-off in crypto came as sentiment across risk assets soured following disappointing earnings guidance from Oracle, a major U.S. cloud and enterprise software company deeply invested in AI infrastructure. The combination of weaker-than-expected profit outlooks and warnings of increased spending shook investor confidence and revived questions about whether current AI investments can generate meaningful returns in the near term.

A Sudden Shift in Crypto Market Momentum

On Thursday morning in Asia, Bitcoin was down 2.5% at $90,056, after briefly dropping below the symbolic threshold that had served as a psychological support level for traders. Ether, the second-largest cryptocurrency by market capitalization, plunged 4.3% to $3,196, erasing gains built up earlier in the week.

This decline followed a volatile Wednesday session in the U.S. market, when digital assets weakened even as broader equities initially reacted positively to the Federal Reserve’s decision to cut interest rates. The divergence between crypto and other risk assets puzzled analysts and signaled a deeper fragility within crypto investor sentiment.

Tony Sycamore, market analyst at IG in Sydney, noted that digital assets failed to benefit from the broader improvement in risk appetite.
“What we saw last night was even though risk assets were doing well, crypto didn't really want to know about it,” he said.
According to him, the crypto market still appears unconvinced that the heavy sell-off seen on October 10 has fully run its course. The hesitation suggests that traders are still wary of re-entering the market aggressively.

AI Profitability Concerns Spark Global Sell-Off

The root of Thursday’s risk-off mood extended beyond the crypto market.

Oracle’s latest financial update revealed that while the company continues to invest heavily in cloud infrastructure and AI capabilities, the return on these investments is not materializing as fast as investors anticipated. Management’s comments about higher spending needs, combined with lower-than-expected profit and revenue projections, triggered a sharp reaction in tech stocks.

This pessimistic read-through spilled across global markets:

• Asian equities retreated, with major indices in Japan, South Korea, and Hong Kong recording notable losses.

• European and U.S. stock futures pointed to weaker openings, indicating that the risk aversion was likely to continue through the day.

AI has been one of the strongest drivers of the 2024–2025 equity rally, with tech giants pouring billions into building data centers, training large language models, and scaling cloud computing capacity. But Oracle’s commentary reignited a lingering fear: that the AI boom may currently be costing more than it is earning, potentially delaying expected returns.

Such fears tend to hit cryptocurrencies disproportionately because digital assets often trade as high-beta risk assets—amplifying the broader market’s movements. Investors tend to pull back sharply from speculative instruments like Bitcoin whenever economic or technological uncertainties surface.

A Changing Narrative Around Bitcoin’s Future

In addition to immediate market pressures, Thursday’s decline coincided with a shift in long-term Bitcoin forecasting. On Tuesday, Standard Chartered—one of the most prominent mainstream institutions bullish on crypto—cut its earlier prediction that Bitcoin would reach $200,000 by the end of 2025.

The bank revised the target downward to $100,000, citing weakening demand from corporate Bitcoin treasury buyers.
Geoff Kendrick, global head of digital assets research at the bank, said:
“We think buying by Bitcoin digital asset treasury companies is likely over. As a result, we now think future Bitcoin price increases will effectively be driven by one leg only – ETF buying.”

This shift reflects an important structural change in the crypto market:

• Earlier in the decade, companies like MicroStrategy and Tesla made high-profile Bitcoin purchases.

• However, corporate treasury buying has largely slowed as businesses prioritize cash safety in a more uncertain economic environment.

• This leaves exchange-traded fund (ETF) demand—particularly from U.S. Bitcoin spot ETFs—as the dominant driver of future price appreciation.

While ETF flows remain significant, their pace has fluctuated, making them insufficient to consistently propel Bitcoin higher during times of broader market stress.

Macroeconomic Backdrop Adds to Volatility

The Federal Reserve’s rate cut—initially expected to boost risk assets—failed to support cryptocurrencies. Typically, lower interest rates weaken the dollar and shift investors toward speculative, high-growth assets. But this time, crypto traders reacted more cautiously.

Multiple factors may explain the muted response:

1. Profit-taking after recent rallies
   Bitcoin has climbed significantly in 2025, and traders often use macro events as opportunities to lock in profits.

2. Liquidity concerns
   Trading volumes have been lower compared to peaks earlier in the year, making price swings more pronounced.

3. AI stock weakness spilling over into crypto
   As AI becomes increasingly intertwined with tech and digital assets, weakness in that sector can influence crypto sentiment.

4. Lingering concerns over October’s sharp crash
   The market is still psychologically recovering from the October 10 wipeout, which erased billions in crypto value.

What Comes Next for Bitcoin?

The dip below $90,000 is symbolically important but not necessarily catastrophic. Analysts note that Bitcoin has repeatedly shown resilience after corrections and that institutional investors still maintain interest in digital assets.

However, several key factors will shape its short-term direction:

• ETF inflows and outflows
  Continued demand through regulated investment products may provide stability.

• AI sector recovery
  If tech companies demonstrate clearer profit pathways for AI infrastructure, risk appetite may rebound.

• Broader macroeconomic signals
  Upcoming inflation and employment data in the U.S. will play a major role.

• Market confidence after October’s volatility
  Many traders want stronger signs that the previous sell-off is fully priced in.

For now, Bitcoin remains on edge as global markets navigate a complex landscape marked by technological uncertainty, shifting investor expectations, and fluctuating macroeconomic trends.