Bitcoin fell on Tuesday, ending a brief recovery rally, as traders remained cautious toward cryptocurrencies, while anticipation of key US economic data added to broader risk-off sentiment.
Bitcoin dropped 2.6% to $87,655.0 as of 08:42 AM US Eastern Time (13:42 GMT). The world’s largest cryptocurrency had recovered earlier this week to around the $90,000 level before retreating again on Tuesday.
Broader cryptocurrency prices also pulled back after a short-lived rebound, although losses remained relatively limited amid thin trading volumes due to year-end holidays.
Bitcoin’s recovery stalls ahead of US data
Bitcoin’s recent recovery was partly weighed down by caution ahead of major US economic data due later on Tuesday.
Third-quarter gross domestic product data are expected to show a slight slowdown in growth compared with the previous quarter, particularly amid volatile consumer spending and fading labor market momentum.
Markets are also awaiting the release of October personal consumption expenditures (PCE) data, the Federal Reserve’s preferred inflation gauge.
Any further signs of a cooling US economy, especially on the inflation front, could open the door for additional interest rate cuts by the Federal Reserve.
However, analysts cautioned that December and fourth-quarter economic data are likely to be more indicative of underlying US economic conditions, as October and November readings may have been distorted by the effects of a prolonged government shutdown.
Strategy pauses Bitcoin purchases, boosts cash reserves
Strategy Inc (NASDAQ: MSTR), the world’s largest corporate holder of Bitcoin, has paused its cryptocurrency purchases in recent weeks and increased its cash reserves, signaling preparation for a potential downturn in crypto prices.
In a regulatory filing, the company said it raised $748 million in the week ended December 21, without purchasing any Bitcoin during that period. Earlier in December, the firm had bought nearly $2 billion worth of Bitcoin, lifting its total holdings to 671,268 Bitcoin.
The company’s shares have declined in recent months, amid growing concerns over the long-term viability of its Bitcoin-focused strategy.
Earlier in December, Strategy was reported to have set aside a $1.4 billion reserve to cover future dividend payments and interest obligations tied to its multiple capital commitments, amid fears that continued declines in Bitcoin prices could force the company to sell part of its holdings to meet those obligations.
The company’s core equity market capitalization has fallen by about 50% during 2025, with pressure intensifying after the stock was excluded from inclusion in a major MSCI index.
Cryptocurrency prices today: altcoins fall alongside Bitcoin
Broader cryptocurrency prices halted their recent recovery and moved lower in line with Bitcoin.
Ether, the world’s second-largest cryptocurrency, fell 3.7% to $2,941.48. BNB slipped 1.7% to $848.51, while XRP dropped 2.2% to $1.88.
