Why Bitcoin is Falling: Seen Below $100,000 with China Effect! - Coin Bulletin

Bitcoin, dropping from 105,000 dollars to 98,905 dollars, experienced sharp losses across the entire crypto market, especially in artificial intelligence tokens and the DeFAI sector.

Bitcoin (BTC), falling from $105,000 to $98,905, lost 5.8% of its value. However, this decline was only a part of the general decline seen in the cryptocurrency market. In particular, AI-focused tokens (AI) experienced the biggest losses in the market.

This sudden drop in the last 24 hours has affected both Bitcoin and other cryptocurrencies. While Bitcoin's 5.8% drop stands out, major cryptocurrencies such as Ethereum (ETH), Solana (SOL), and XRP also showed negative performance. However, the biggest losses in the market were experienced in artificial intelligence projects.

Why did Bitcoin fall?

One of the main reasons for the decline in Bitcoin was the announcement that DeepSeek, a China-based artificial intelligence company, has developed a product that can rival OpenAI at a low cost. The announcement of DeepSeek's low-cost competitor product to OpenAI had a significant impact on the market. The model developed by DeepSeek not only surpassed OpenAI with a cost of only 6 million dollars and minimal hardware requirements, but it was also noted that this model is efficient enough to run even on mobile phones. This situation has deeply shaken GPU-connected AI projects.

The first FOMC meeting of the Federal Reserve in (Fed) will be held on January 28-29. The expectation of no interest rate cut in the market has led investors to stay away from risky assets. This situation has put pressure on Bitcoin prices.

US President Donald Trump has instructed the establishment of a policy group that will develop recommendations for the cryptocurrency industry within six months. While this development is a positive catalyst for the market, it was not enough to stop the decline of Bitcoin.

Additionally, the decline in Bitcoin price once again highlighted the close relationship with US technology indices. Major indices such as S&P 500 and Nasdaq 100 fell by 2.15% on Monday, creating a general negative sentiment in technology-related assets. Despite ongoing cryptocurrency purchases by organizations such as MicroStrategy and Trump's World Liberty Financial, the market is dominated by expectations of a decline. This situation is prompting investors to take more conservative positions, such as 95,000 dollar options.

(# Sharp drop in AI-focused altcoins

While AI-focused tokens fell by about 9% according to CoinGecko data, some projects experienced losses well above this average. For instance, Nodes.AI stood out with a 20% drop, while Aethir experienced a 6% loss. However, the most shocking decline was observed in smaller projects and the DeFAI sector.

On January 27th, almost all sectors of the cryptocurrency market experienced a decline. However, the biggest blow was in the DeFAI )Decentralized Finance AI### sector. This sector lost 28.73% of its value within 24 hours. The losses in individual projects were much more dramatic:

• Hive AI (BUZZ): 35.61%
• GRIFFAIN: %25,97
• ORBIT (GRIFT): %22.52
• NEUR: %22,14

In addition, there was a loss of 16.91% in the AI Agents category. Virtuals Protocol declined by 12.74%, while Fartcoin experienced a drop of 22.11%. These losses highlight how artificial intelligence projects are being affected by increasing competition in the technology world.