Bitcoin investors should prepare for continued pressure as a less favorable macro backdrop for risky assets emerges amid rising U.S. prices. Steno Research highlighted in a January 13 report that the current environment is increasingly challenging for Bitcoin (BTC) and other speculative assets, driven by a mix of stubborn inflation, tighter financial conditions, and lingering leverage in derivatives markets. Since the middle of December, Bitcoin’s spot price has fallen by roughly 10%, sliding from around $106,000 to about $96,000 as of January 14. The researchers cautioned that the downtrend could persist, with Bitcoin potentially slipping to as low as $85,000 per coin under adverse conditions. The core takeaway from Steno is that the ongoing repricing reflects an unfavorable macroeconomic environment, with inflation once again taking center stage as a key driver of asset pricing and risk sentiment.
In parallel, Bitcoin’s derivatives markets are appearing overheated, according to the same analysis. The presence of elevated open interest and leverage signals that there is still excess risk-taking that needs to be unwound during this repricing phase. Steno argued that even as spot prices drift lower, the margin and leverage dynamics in futures markets can amplify price movements and prolong drawdowns, particularly when inflation signals surprise to the upside or when the macro narrative shifts toward tighter or more prolonged restrictive policy. The interplay between the spot market and the derivatives market matters for traders who rely on cross-market signals to gauge momentum, liquidity, and the likelihood of rapid volatility spikes. Steno warned that sustained U.S. inflation could further depress the crypto market, potentially worsening conditions before prices eventually recover to more favorable levels. This assessment emphasizes both the near-term risks and the longer-term fragility that can exist when inflation and policy expectations move in ways that constrain high-risk assets like Bitcoin.
On the pricing side, the open interest in Bitcoin futures has remained elevated, a sign that market participants have positioned themselves for continued volatility and possible further downside. This backdrop of high leverage and persistent demand for risk exposure in the futures market contributes to a dynamic where any new inflation or policy news can trigger outsized price responses. In such an environment, the actual path of Bitcoin depends heavily on how inflation data, central bank actions, and broader financial conditions evolve over the coming weeks and months. Steno’s core view remains that higher-than-expected inflation readings and a measured or hawkish stance from the Federal Reserve could extend downward pressure on digital assets, including Bitcoin, by keeping real interest rates elevated and risk premia elevated for speculative instruments.
Macroeconomic unease and near-term catalysts
A look at the timeline surrounding macroeconomic data reveals how rapidly sentiment can shift for Bitcoin. On January 10, a stronger-than-expected U.S. jobs report sent Bitcoin’s spot price down through a key support zone, briefly dipping below $93,000 as the U.S. dollar strengthened in anticipation of slower pace of interest rate reductions. The market currently prices the probability of a January rate cut by the Federal Reserve at less than 3%, according to CME FedWatch data. This pricing reflects a realization among investors that the central bank remains inclined to prioritize inflation control over near-term stimulus, even as the economy shows signs of cooling. In this context, Bitcoin’s performance has historically shown sensitivity to the strength of the dollar and expectations for interest rate trajectories, making the current environment particularly challenging for anti-dollar hedges and high-beta risk assets.
A crucial perspective from Zach Pandl, who serves as Grayscale’s head of research, emphasizes that Bitcoin’s recent underperformance has been tied to dollar strength produced by a hawkish Fed policy posture and the possibility of tariffs that could intensify inflationary pressures. Pandl noted to Cointelegraph that, in such conditions, a stronger dollar can weigh on Bitcoin and other speculative assets, even when the longer-term fundamentals might be supportive. The general principle is straightforward: when U.S. monetary policy tightens or is perceived as being on hold longer than expected, and the dollar appreciates, riskier assets tend to experience negative price pressure. This dynamic is particularly impactful for Bitcoin because of its status as a highly sensitive asset to liquidity, risk appetite, and macro policy expectations.
The potential for inflation surprises adds another layer of complexity. Steno forecast that the upcoming U.S. Consumer Price Index (CPI) release on January 15 would show inflation running hotter than consensus expectations, with a monthly headline rise near 0.4% versus a 0.3% consensus. Such an upside surprise could trigger a fresh round of selling in the crypto market, reinforcing the narrative that rising prices and the prospect of delayed or fewer rate cuts weigh on risk assets. If this scenario materializes, Steno estimated that Bitcoin could fall to approximately $85,000 per coin, underscoring the potential for a swift and meaningful reversal in a market already vulnerable to macro shocks. The anticipation of higher inflation also feeds into concerns about longer-duration assets and growth equities, thereby contributing to broad-based selling pressure that could spill over into digital assets.
Interest rates, yields, and inflation narratives
In the broader macro landscape, rates and yields play a central role in shaping crypto price action. Ten-year U.S. Treasury yields have been rising amid inflation fears, a trend that tends to pull liquidity away from high-risk assets like Bitcoin and into safer or higher-yielding instruments. The interconnectedness of macro indicators means that even if there is eventual progress toward disinflation, the path may be uneven, with periods of upside surprise in inflation numbers continuing to rattle markets and complicate policy expectations. Steno’s analysis argues that if their CPI forecast proves accurate, an upside inflation surprise would catch markets off guard and exert further downward pressure on digital asset prices in the near term. In that context, a scenario where Bitcoin dips to $85,000 is consistent with a risk-off environment that features tighter financial conditions, higher real yields, and reduced liquidity for speculative assets.
Looking beyond the near term, Steno signaled a notably more optimistic long-range view for the cryptocurrency market in 2025. They projected what they described as the crypto market’s best year ever, with Bitcoin reaching new all-time highs and delivering remarkable positive developments across the sector. The reasons cited for this upbeat outlook include the prospect of a significantly more favorable regulatory environment for cryptocurrencies, a macroeconomic climate characterized by declining interest rates and improved liquidity, and a history of strong performance following Bitcoin halving events. The combination of regulatory clarity, healthier macro conditions, and the intrinsic supply-demand dynamics linked to halving cycles is viewed as a powerful catalyst for a prolonged bullish phase. This long-term scenario envisions Bitcoin advancing to as high as $150,000 per coin, supported by the convergence of several favorable forces that could reinforce confidence, attract capital inflows, and sustain momentum over multiple quarters.
In summarizing this long-term outlook, Steno highlighted the role of policy and regulation in enabling mainstream adoption and liquidity improvements. They argued that an environment with clearer guidance, predictable enforcement, and structured compliance pathways can lower the cost of capital for participants, reduce systemic risk, and boost investor appetite for digital assets. At the same time, Steno pointed to macro advantages such as lower interest rates and improved market liquidity as being essential to sustaining durable upside for Bitcoin. Taken together, these factors are presented as the scaffolding for a potential multi-year expansion in crypto asset prices, even if the near-term horizon remains challenged by inflation dynamics and policy uncertainty.
Understanding the implications for Bitcoin’s price path
The combination of a hot inflation narrative, a cautious posture from the Federal Reserve, and elevated derivative leverage can create a backdrop where Bitcoin’s price is more sensitive to inflation surprises and policy shifts than at other times. The January CPI data, the trajectory of the Fed’s rate decisions, and the strength of the U.S. dollar will be deterministic in shaping whether Bitcoin’s next moves are characterized by continued declines toward the mid- to low-90s or by a stabilization that allows a gradual reaccumulation and potential upside reentry. The risk of further downside from a macro shock is real, given the velocity with which rates and yields respond to inflation signals. Investors should monitor the interaction between inflation readings, monetary policy expectations, and the liquidity conditions in both traditional markets and crypto markets, as this triad will likely govern Bitcoin’s near-term volatility and the longer-term trajectory.
In addition to macro indicators, there are micro dynamics in the Bitcoin ecosystem that can influence price behavior. For instance, the level of open interest in Bitcoin futures signals market participants’ willingness to assume risk and place bets on directional moves. If open interest remains high while price declines, it can signify persistent hedging activity or speculative bets that can prolong drawdowns as traders adjust positions in response to new data. Conversely, signs of deleveraging and reduced liquidity could amplify price moves in either direction, especially if large players begin to unwind positions in a concentrated manner. The interplay between spot price action and derivatives market activity often creates cascading effects that impact volatility, liquidity, and the speed at which new information is priced into markets. These dynamics add a layer of complexity for investors and traders trying to navigate the Bitcoin market during times of macro-driven stress.
Regulatory expectations and their potential impact
A central pillar of the 2025 bull case rests on an anticipated improvement in the regulatory landscape for cryptocurrencies. If policymakers implement comprehensive, clear, and operational rules that reduce uncertainty and create a path to broader institutional participation, the perceived risk of crypto investment could diminish, encouraging capital inflows. This improvement in regulation would not only enhance credibility but could also lower the cost of capital for crypto-related projects, improve risk management practices across the industry, and attract more traditional financial players into the space. In addition, a favorable regulatory regime could expedite the development of regulated crypto products and custody solutions, fostering greater participation among both retail and institutional investors. The combination of regulatory clarity and improved liquidity could help support a more resilient market structure, enabling price advances that are less vulnerable to sudden downside shocks.
On the other hand, regulatory risks remain a real consideration. The crypto market has historically been sensitive to policy shifts and enforcement actions, which can lead to abrupt repricing and heightened volatility. Any changes that restrict market access, raise compliance costs, or limit innovative products could offset some of the positive momentum expected from other macro factors. Therefore, investors should factor regulatory risk into their risk-management frameworks and consider the potential for policy surprises when assessing Bitcoin’s risk-reward profile. In a landscape where fundamental demand for digital assets exists but policy uncertainty persists, the trajectory of Bitcoin can diverge markedly from expectations, underscoring the need for ongoing monitoring of regulatory developments and their practical implications for liquidity and price discovery.
Long-term considerations for investors and market participants
Despite the near-term headwinds, the longer-term equity-like cycle for Bitcoin remains a possibility if the factors highlighted by Steno materialize as expected. The prospect of a substantial rally hinges on a combination of a constructive regulatory environment, a macro backdrop characterized by easing liquidity conditions, and a successful post-halving momentum that historically has supported price appreciation. In such a scenario, Bitcoin could benefit from renewed attention from both retail and institutional investors who have been waiting for clearer signals and a more favorable macro environment. The potential for a multi-year bull run remains contingent on the confluence of policy clarity, macro resilience, and investor confidence, making the path to new highs a nuanced and data-driven process rather than a simple consolidation or a one-off spike.
Market participants should also be mindful of the possibility of continued volatility even in the presence of a longer-term bullish narrative. Crypto markets have proven to be sensitive to shifts in macro policy and inflation dynamics, and the interaction with other asset classes can produce rapid re-pricing. The insights from Steno emphasize that while the 2025 outlook is optimistic, the near-term path could be punctuated by sharp corrections that reflect inflation surprises, policy pivots, or changes in liquidity conditions. As such, investors are advised to maintain a balanced portfolio approach, incorporate robust risk controls, and stay adaptable to evolving macro signals as the crypto market navigates through a period of potential transition.
Conclusion
In summary, Bitcoin now operates within a climate marked by rising prices, inflationary pressures, and a macroeconomic framework that has become more challenging for risky assets. The January 13 analysis from Steno Research highlights a risk-reward balance that tilts toward further downside unless inflation cools more quickly or policy becomes more supportive. The current price path has been shaped by a drop from approximately $106,000 to around $96,000, with a potential downside scenario yielding a fall to about $85,000 per coin if inflation surprises to the upside and rates remain restrictive. The derivatives market’s elevated open interest adds another layer of risk, suggesting that leverage unwinding could extend drawdowns before a potential stabilization occurs. On a more optimistic note, the firm expects 2025 to be a standout year for the cryptocurrency market, driven by a combination of a permissive regulatory environment, favorable macro conditions including lower rates and improved liquidity, and historically strong post-halving performance, with a long-term target of $150,000 per Bitcoin.
Investors should monitor the inflation data, the trajectory of U.S. dollar strength, and the Federal Reserve’s policy stance, as these elements are likely to determine the near-term direction of Bitcoin. The CPI print, rate expectations, and the overall liquidity landscape will play critical roles in shaping whether Bitcoin continues its current consolidation, resumes a corrective decline toward lower levels, or begins to form a durable base that could underpin a broader rally in the years ahead. While the risk of further downside remains real in the near term, the longer-term narrative presented by Steno aligns with a framework in which Bitcoin can achieve substantial upside if regulatory clarity, macro conditions, and halving dynamics converge in favor of investors and market participants.
For now, the market appears to be balancing between macro-driven risk aversion and appetite for crypto exposure, with Bitcoin acting as a barometer of broader financial conditions. As price action unfolds, traders and investors should maintain disciplined risk management, diversify their exposure, and stay attuned to both inflation headlines and policy developments that could alter the trajectory of digital assets. The coming months will be crucial in determining whether the bearish pressures persist, whether a bottoms-up recovery emerges, or whether the market transitions into a more sustained growth phase aligned with a favorable regulatory and liquidity environment. In any case, Bitcoin’s path remains deeply intertwined with the evolution of macroeconomic forces, policy decisions, and the evolving narrative surrounding digital currencies as mainstream financial instruments.