Bitcoin falls below $110,000 as ‘cautious tone’ sweeps over market
Bitcoin (BTC-USD) slipped below $110,000 on Thursday amid a broader sell-off in crypto and stocks.
The largest cryptocurrency declined more than 3% while ethereum (ETH-USD), solana (SOL-USD), and other coins saw even bigger drawdowns in what has been a rocky week for the crypto market.
Ether fell roughly 5% to below $3,900 before paring losses, marking its lowest level since August, as ethereum exchange-traded funds (ETFs) saw net outflows over the past 24 hours.
“The persistent downward pressure is rooted in the absence of sufficient buying power to defend prices following the massive wave of liquidations seen on Monday,” wrote Samer Hasn, senior market analyst at asset brokerage platform XS.com.
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“Another round of long liquidations today further weakened sentiment, while corrections in the broader equity market amplified the cautious tone,” he added.
More than $1.6 billion in long positions was liquidated earlier this week, spooking investors. According to CoinGlass, over the past 24 hours, $511 million across all cryptoassets was liquidated.
The action comes as stocks decline from recent records amid investor concerns of frothiness driven by AI enthusiasm and uncertainty over the Federal Reserve’s path for interest rates.
Strategists have pointed to September as a seasonally volatile month for crypto, with the last three months of the year typically ushering in tailwinds.
Crypto bulls point to another headwind stemming from the Treasury General Account, which essentially serves as the government’s checking account at the Federal Reserve.
The Treasury has been refilling this account in recent weeks by issuing T-bills and bonds, serving as a type of liquidity drain for crypto. The diversion of cash into government debt can reduce demand for risk assets like bitcoin and other cryptocurrencies.
The rout in bitcoin and ether extended into crypto-related stocks on Thursday. Trading platforms Robinhood (HOOD) and Coinbase (COIN) each declined more than 1%.
Bitcoin holder Strategy (MSTR) and stablecoin issuer Circle (CRCL) also declined.
Ines Ferre is a senior business reporter for Yahoo Finance. Follow her on X at @ines_ferre.
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