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Bitcoin (BTC) Price: Falls to $87,000 as Government Shutdown Fears Mount

TLDR

• Bitcoin dropped to around $87,000 on Sunday as market nerves increased ahead of a volatile week of economic events
• Fears of a US government shutdown reached 75% probability on Polymarket, weighing on risk assets including crypto
• US spot bitcoin ETFs recorded $1.33 billion in net outflows last week, their worst performance since February 2025
• Over $250 million in crypto liquidations occurred in 24 hours, with long positions making up the majority
• The Federal Reserve meets January 28 with only a 2.8% chance of a rate cut despite pressure from President Trump

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Bitcoin fell below $88,000 on Sunday evening as concerns about a potential US government shutdown weighed on cryptocurrency markets.

The world’s largest cryptocurrency dropped 1.93% in 24 hours to $87,158. Data from Bitstamp showed BTC reached lows of $87,471 during the session.

Ethereum also declined 3.17% to $2,847 during the same period.

“The move in crypto to start the week was driven by a broad macro risk-off impulse rather than crypto-specific news,” said Rick Maeda, research associate at Presto Research.

The probability of a US government shutdown climbed to 75% on Polymarket. The risk stems from stalled spending limit negotiations and political deadlock in Congress.

Democratic lawmakers have threatened to block a Department of Homeland Security funding bill. The standoff follows controversy over federal law enforcement actions, according to the Associated Press.

Liquidations Hit $250 Million

Over $250 million in crypto liquidations occurred in the past 24 hours, per data from CoinGlass. Long positions made up the majority of these forced closures.

Trader CrypNuevo identified $86,300 as a key support level for bulls. “Based on Bitcoin losing the mid-range, we still think that the most likely scenario is that Bitcoin drops back to low $80s in the coming weeks,” he wrote.

ETF Outflows Signal Caution

US spot bitcoin exchange-traded funds posted their worst week since February 2025. The funds recorded approximately $1.33 billion in net outflows for the week ending January 23, according to SoSoValue data.

Crypto ETF Weekly Flows (Mon – Fri)

Bitcoin $BTC spot ETFs saw $1.3B in net outflows
Second-largest weekly outflow on record

Ethereum $ETH spot ETFs recorded $611M in net outflows

Solana $SOL spot ETFs posted $9.5M in net inflows

$XRP spot ETFs saw $40.6M in… pic.twitter.com/vWtFbxhJdA

— Trader Edge (@Pro_Trader_Edge) January 25, 2026

“While broad outflows from spot Bitcoin ETFs signal risk-off sentiment, selective buying in infrastructure and industry leaders suggests long-term conviction remains,” said Vincent Liu, CIO of Kronos Research.

Ark Invest purchased millions of dollars worth of Coinbase, Bullish, and Circle shares on Friday. However, Maeda noted that Ark has consistently favored crypto-related equities across market cycles.

Fed Decision Looms

The Federal Reserve will announce its interest rate decision on January 28. CME Group’s FedWatch Tool puts the odds of a 0.25% rate cut at just 2.8%.

President Donald Trump has pressured the Fed to cut rates further. Markets expect no change to current interest rates.

Traders will also monitor upcoming US producer price index data for inflation clues. “In crypto specifically, ETF flow stabilization and BTC’s ability to hold recent support levels are key near-term signals,” Maeda said.

The post Bitcoin (BTC) Price: Falls to $87,000 as Government Shutdown Fears Mount appeared first on CoinCentral.

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