Bitcoin Climbs to $90,000 at Year's Start – Tax Effects and Venezuela Crisis Influence Market

Crypto Market Starts New Year Strong

Bitcoin is trading just below the $90,000 mark at the start of the weekend, after the cryptocurrency even reached around $90,800 on Thursday evening ^[1]. In 24-hour comparison, BTC is thus up just under one percent ^[1]. Other leading cryptocurrencies are also recording significant gains: Ethereum climbed above $3,100 with an increase of around two percent ^[1].

XRP is showing particularly strong performance, having recaptured the $2 mark and gaining approximately seven percent during the observed period ^[1]. Solana recorded a price gain of around 2.5 percent and is now trading at $130 ^[1]. However, the memecoin sector is leading the market: PEPE jumped up around 20 percent, Fartcoin increased by approximately 14 percent, and Dogecoin gained just under nine percent ^[1].

Tax Effects as Price Driver

While the U.S. stock market and precious metals experienced a difficult start to the new year, the crypto market is gaining across the board ^[1]. Analysts attribute this to several factors. In the United States, many investors deliberately used the end of 2025 for tax-loss harvesting by realizing crypto losses to offset their high capital gains from the strong stock year for tax purposes ^[1].

Additionally, so-called window dressing plays a role: institutional investors often sell poorly performing assets at year-end and instead buy winners to make their balance sheets more attractive to clients ^[1]. This process led to Bitcoin ETFs coming under additional pressure in December, while trends among winners were artificially amplified ^[1]. In parallel, many fund managers secured their annual gains and bonuses by dissolving risky positions such as those in cryptocurrencies or at least not entering new ones ^[1].

Geopolitical Tensions Weigh Short-Term

Despite the positive start, Bitcoin reacted on Saturday to U.S. military actions in Venezuela. The cryptocurrency fell back from highs near $90,940 on Bitstamp ^[2]. President Donald Trump announced on Truth Social that Venezuela's president had been captured and flown out of the country ^[2].

"We're seeing some short-term selling pressure due to ongoing U.S. actions against Venezuela, but I remain short-term bullish," responded analytics account @Wealthmanager in a post on X ^[2]. "If this situation doesn't escalate further, I see the move as a temporary pullback, with a probable recovery soon. $96,000 to $100,000 remains my target for the coming days/weeks" ^[2].

Crypto analyst Lennaert Snyder emphasized that much depends on the return of traditional financial markets in the coming week: "There's a lot of geopolitical tension and next week the big players will return. So we'll likely see more volatility in Bitcoin after the weekend" ^[2].

Technical Outlook and Gold Rotation

Crypto trader Michaël van de Poppe described Bitcoin's recent movement as a "classic" Venezuela reaction and maintained an optimistic outlook. "The direction for January is clear: upward, as long as Bitcoin stays above the 21-day MA," he concluded, referring to the 21-day simple moving average at $87,850 ^[2].

Also noteworthy is Bitcoin's relative strength against gold over the New Year holidays. After gold reached new all-time highs of $4,551 per ounce on December 26, XAU/USD fell by up to six percent, while BTC/USD simultaneously gained up to five percent ^[2]. Trading resource Bull Theory commented: "One important thing is that the last time Bitcoin began its parabolic rally was after gold peaked" ^[2].