BTC dropped 5% on Friday, falling below $69,000. Experts say it was triggered by a "concentrated liquidation" and "weakening" demand.
Leading cryptocurrency Bitcoin has dropped 5.6% on the day, and is currently trading at just over $69,300, per Decrypt data. It comes after the latest consumer price index, or CPI, results came in "hotter than expected," experts said, with the drop was triggered by a "concentrated liquidation."
Bitcoin's plunge took it to a 24-hour low of $67,922, its lowest level since mid-August, when it boosted from $63,000.
"Bitcoin’s drop below $69,000 was directly triggered by a concentrated liquidation of leveraged long positions," Tim Sun, senior analyst at Hashkey, told Decrypt. "Though the deeper issue lies in steadily weakening market demand."
Sun highlighted U.S. Bitcoin spot ETFs recording six consecutive days of net outflows, according to CoinGlass. He also pointed to stablecoin supply shrinking and MSCI removing digital asset treasury firm Strategy from its funds.
North Korea Stole $400 Million in Crypto Using Deepfake Video Calls, DOJ Says
"ETFs, stablecoin liquidity, and corporate treasuries have served as the primary capital pillars supporting this Bitcoin rally," Sun said. "With all three coming under simultaneous pressure, the market is losing the marginal buying power that previously propelled prices higher."
Meanwhile, other major cryptocurrencies have also taken a hit. Ethereum has dropped 4.6% on the day to $1,953, BNB has slipped 4.7% to $639.46, and Solana is down 3.1% to $80.47, according to Decrypt data. The global crypto market cap has dropped 4.6% over the past 24 hours to $2.39 trillion.
It follows U.S. CPI rising 0.4% in October, which is "hotter than expected, even if the headline monthly rate eased to 0.4% from September’s 0.6%," according to CoinShares head of research James Butterfill. "More troubling was the composition," he added. "Food rose 0.5%, services remained firm, and core CPI increased 0.3%, with services excluding rent, a gauge of domestic price pressure the Fed watches closely, rising 0.5%. The inflation problem is therefore no longer easily dismissed as an oil story."
Avalanche Won Over the NYSE. Now It Has to ‘Capture Value’ for AVAX
The consumer price index, or CPI, is a way of measuring inflation that tracks the average price changes of everyday goods and services over time. Central banks tend to use CPI to inform whether they'll cut or hike interest rates, meaning higher-than-expected CPI signals a potential Federal Reserve hike.
Polymarket predictors put a 97% chance on the Fed raising interest rates this year, up from 75% at the start of the week. The CME FedWatch tool, meanwhile, sees an 88% chance of a 25 basis point hike, with 12% anticipating a 50 basis point rise.
On top of the CPI, Bitcoin's downward move comes following Nvidia CEO Jensen Huang resigned from the company, after reports of multiple affairs including with a suspected Chinese spy and a senior company executive spread.
'A Massive Mistake': Tech, AI and Crypto Founders React to Jensen Huang’s Nvidia Exit
Huang's departure has sparked "severe volatility across tech stocks, further dampening market risk appetite," Sun told Decrypt. "This has prompted broader portfolio de-risking, amplifying the downward pressure on Bitcoin," he added.
For a crypto rebound to happen, Sun said that Bitcoin needs "long-term allocation capital" to flow back into crypto after ETFs, stablecoins, and digital asset treasury companies have taken a hit in recent weeks.
There's no single catalyst behind the move. Instead, BTC was hit by a succession of negative developments while underlying demand and liquidity have weakened considerably.
One of Wall Street’s biggest trading firms just showed its Bitcoin hand. But reading it correctly takes more than a glance at the headline numbers. Jane Street’s latest Form 13F, filed with the SEC on Nov. 12, shows its combined stake in three major spot Bitcoin ETFs rose from about $926 million at the end […]
Need to know what happened in crypto today? Here is the latest news on daily trends and events impacting Bitcoin price, blockchain, DeFi, Web3 and crypto regulation.
Bitcoin just had its worst week since summer. But the reason behind the drop may be exactly why some analysts see an opportunity. BTC fell to about $68,000 overnight, its lowest level since August and more than 20% below early October. At its lowest point, Bitcoin touched $67,770 as liquidations topped $1.6 billion, with roughly […]
