New York, January 30, 2026, 13:35 (EST) — Regular session
- Bitcoin dipped into the low $82,000s following a volatile week for risk assets
- Crypto-related U.S. stocks dropped, miners bearing the brunt of the losses
- Traders honed in on the Fed leadership shift and its potential impact on liquidity
Bitcoin dropped roughly 2% to $82,173 on Friday, hitting a low of $81,169 earlier. Coinbase slipped around 4%, Riot Platforms plunged close to 10%, and Marathon Digital Holdings dropped about 5%. Strategy remained mostly flat.
The decline came after news broke that Donald Trump has chosen former Fed governor Kevin Warsh to take over the Federal Reserve once Jerome Powell steps down in May. Gary Paulin, global chief investment strategist at Northern Trust Asset Management, noted investors are questioning what a smaller balance sheet means for “asset pricing and for liquidity.” 1
The Fed stuck to its cautious approach this week, keeping the federal funds rate target range steady at 3.5% to 3.75%. It signaled that any changes would depend on upcoming data and evolving risks. 2
Bitcoin has dropped to a two-month low, down about a third from its October peak, and looks set for a fourth consecutive monthly loss—the longest streak in eight years. Ether fell nearly 3%, hovering around $2,735. Damien Boey, portfolio strategist at Wilson Asset Management, called the shift a “pulling the rug out” from popular hedges tied to balance-sheet expansion. Sean Dawson, head of research at Derive.xyz, cited “fears around AI exuberance” after Microsoft shares tumbled roughly 10%, fueling the risk-off sentiment. 3
“Liquidity” is a loaded term for crypto traders. It basically measures how easily you can borrow, trade, and manage risk—and bitcoin usually performs better when cash is flowing freely.
Second-order trades have hit miners harder. Their costs, like power expenses, are mostly dollar-denominated, but their revenue depends on the coin price. This makes their shares swing more wildly than bitcoin, both up and down.
Warsh’s nomination still awaits Senate approval, and the timing could influence how markets view the transition. Fed governor Stephen Miran said he expects Warsh to take over his seat, which expires Jan. 31. Miran added that officials will treat Warsh “with a lot of respect” despite his past sharp public criticism of the central bank. 4
The risks swing both ways now. Bitcoin might steady fast if investors bet the next chair will favor rate cuts or maintain ample liquidity. On the flip side, rising yields and a continued stock selloff could drag the token down to test the $80,000 mark and prolong month-end selling pressure.
The next key data on rates is just around the corner. The Bureau of Labor Statistics will publish the January U.S. jobs report on Feb. 6, while job openings figures drop earlier on Feb. 3. The Fed’s upcoming policy meeting is slated for March 17-18. 5
