Bitcoin steadied after Tuesday’s sharp selloff, moving in line with broader risk-off trends in equities, while altcoins faced heavier losses amid elevated market volatility.

The crypto market consolidated overnight following a heavy wave of selling that drove bitcoin down to a low of $87,760. Since hitting that bottom around 23:00 UTC, the largest cryptocurrency has rebounded slightly and was last trading near $89,000, returning to the middle of a range that has largely held since Nov. 20. The only exception was a brief five-day breakout last week, when bitcoin climbed toward $98,000 after a bullish start to the year.

The week’s downside move coincided with growing risk aversion in traditional markets. Nasdaq 100 and S&P 500 futures are both down roughly 2% since Sunday’s open, following Wall Street’s steepest single-day drop since October.

Safe-haven assets rallied as a result, with gold and silver reaching fresh record highs as investors sought protection amid renewed fears of a U.S.-EU trade dispute. President Donald Trump’s threats of tariffs linked to Greenland’s ownership, coupled with retaliatory proposals from European officials, intensified investor caution.

Thin liquidity in crypto markets magnified altcoin losses. CoinGlass data showed that approximately $500 million in altcoin futures positions were liquidated over the past 24 hours alone.

Derivatives Snapshot

Bitcoin experienced significant liquidations during Tuesday’s drop to $87,760, with $324 million in long positions wiped out. The subsequent bounce triggered roughly $34 million in short liquidations.

The 30-day implied volatility for bitcoin spiked to 44.34 on Tuesday, the highest since Jan. 10, as traders turned to options markets to hedge risk.

Open interest in bitcoin futures fell 3.25% to $28.3 billion over the past 24 hours, coinciding with a roughly 2% price decline. A $300 million drop in open interest around 05:00 UTC coincided with a brief move back toward $90,000, reflecting profit-taking among short sellers.

Global funding rates remained positive throughout the selloff, signaling that leveraged traders continue to maintain a bullish bias despite the recent negative price action.

Elsewhere, zcash saw a 2.5% decline in open interest alongside a 1.5% price increase, suggesting that traders who had short positions since the Jan. 8 governance dispute may be reducing bearish exposure.

Token Highlights

Monero led altcoin losses in the past 24 hours, dropping 13.6% and extending its decline to 37.25% from its Jan. 14 record high.

Ether fell 4.5%, underperforming other major tokens like Solana and XRP, which were down roughly 1.25%. Cardano proved relatively resilient, losing only 0.85%.

In contrast, blockchain gaming token Axie Infinity bucked the broader trend, rising more than 16% on $2.1 billion in daily volume to reach its highest level since September. AXS is now up 165% since Jan. 13, highlighting strong performance among metaverse-related tokens.

The CoinDesk Metaverse Select Index (MTVS) has been the year’s top performer, up 43.9% year-to-date, while DeFi and memecoin indices are down 4.2% and 3.6%, respectively.

Meanwhile, WLFI, the DeFi token linked to President Trump’s family, gained 6.6% since midnight UTC. The rise appears driven by increased activity around the platform’s USD1 stablecoin, whose circulating supply has grown from $2.7 billion to $3.4 billion since Dec. 24.

CoinMarketCap’s “altcoin season” index remains low at 26 out of 100, pointing to a bearish environment for altcoins relative to bitcoin. However, several tokens have entered oversold territory, raising the potential for a short-term relief rally later this week.