Bitcoin Retreats in Asian Trade as Geopolitical Risks and U.S. Jobs Data Weigh on Sentiment

Bitcoin fell during Asian trading on Thursday, extending a pullback from a short lived recovery at the start of the year, as investors scaled back risk exposure amid rising geopolitical tensions in both Latin America and Asia. Caution ahead of key U.S. labor market data also discouraged fresh positioning across crypto markets, keeping prices under pressure.

The world’s largest cryptocurrency slipped 1.5% to $91,093.8 by 00:06 ET (05:06 GMT), after briefly touching an intraday low of $90,642.7. Bitcoin’s early January rebound has struggled to gain traction, with prices failing to reclaim the $95,000 level, a zone many traders view as a key technical threshold for renewed upside momentum.

The inability to sustain gains has reinforced the view that broader conviction in crypto markets remains fragile, particularly as global investors reassess risk in the face of mounting political and macroeconomic uncertainty.

Geopolitical tensions curb risk appetite

Demand for risk sensitive assets such as cryptocurrencies remained subdued as geopolitical risks intensified across multiple regions. In Asia, a long running diplomatic dispute between China and Japan escalated this week, after Beijing imposed export curbs and launched an anti dumping investigation targeting Japanese chemical producers.

Chinese state media also raised the prospect of restricting rare earth exports to Japan, a move that would pose significant challenges for Japan’s manufacturing sector, which is heavily dependent on these critical materials. The dispute has its roots in comments made in late 2025 by Japanese Prime Minister Sanae Takaichi regarding potential military involvement in Taiwan, remarks that were sharply criticized by Beijing.

The renewed friction has added to broader regional uncertainty, dampening appetite for speculative investments and weighing on sentiment across Asian markets, including digital assets.

In Latin America, investors continued to monitor developments following the U.S. military incursion into Venezuela that resulted in the capture of President Nicolas Maduro. Markets remain uncertain over Washington’s longer term plans for the country, with reports suggesting that President Donald Trump is considering exerting control over Venezuela’s oil industry for several years.

Such a move could provoke backlash from China and other global powers with interests in the region, potentially increasing political instability and complicating global energy markets. The episode rattled financial markets earlier in the week, driving flows into traditional safe haven assets such as gold and the U.S. dollar, while Bitcoin largely failed to attract similar defensive demand.

Treasury company concerns linger

Uncertainty surrounding crypto treasury companies also weighed on sentiment, particularly around Strategy Inc, the world’s largest corporate holder of Bitcoin. Strategy, which saw its share price nearly halve in 2025, offered limited relief to crypto markets after MSCI said it would not proceed with a proposal to remove digital asset treasury companies from its indexes.

While the decision ensures that such companies remain included for now, MSCI also indicated it will carry out a broader review of index inclusion criteria, keeping longer term uncertainty alive. The combination of large unrealized losses, a prolonged downturn in Bitcoin prices, and questions over the sustainability of debt funded crypto accumulation strategies has continued to cast a shadow over the sector.

U.S. jobs data keeps traders cautious

Adding to the cautious tone, investors largely stayed on the sidelines ahead of the release of U.S. nonfarm payrolls data for December, due on Friday. The report is expected to play a critical role in shaping expectations for Federal Reserve policy, particularly as markets debate whether the central bank will hold interest rates steady or begin easing later in the year.

With interest rate expectations closely tied to valuations across risk assets, traders were reluctant to make large directional bets in crypto markets before gaining clarity on the strength of the U.S. labor market.

Altcoins retreat alongside Bitcoin

Broader cryptocurrency prices tracked Bitcoin lower on Thursday, giving back much of their early year gains as risk aversion set in. Ethereum fell 2.8% to $3,156.15, while XRP, which had outperformed earlier in the week, dropped 4%.

Solana declined 0.6%, Cardano slipped 2.2%, and BNB fell 1.8%. Among meme tokens, Dogecoin eased 0.6%, while the $TRUMP token shed 1.1%.

Overall, crypto markets remain caught between short term optimism tied to the new year and a growing list of macroeconomic and geopolitical headwinds. Until clearer signals emerge from U.S. economic data and global political developments, analysts expect digital assets to remain volatile and largely range bound, with rallies likely to face resistance amid fragile risk sentiment.