Bitcoin has tumbled back into five-figure territory, hitting an intraday low of $95,164 during early trading hours in Asia on Wednesday, according to CoinGecko. The drop marked a 6% decline within 12 hours, erasing much of the asset’s recent gains.

Just a day earlier, on January 7, Bitcoin had climbed to $102,000, a 10% weekly increase. However, the current sell-off has wiped out those advances. Despite this setback, BTC continues to trade within the range it has been stuck in since mid-December, following a decline from its all-time high.

Massive Liquidations Hit the Market:

Over the past 24 hours, the crypto market has experienced liquidations totaling $695 million, according to Coinglass. Around 235,000 traders were affected, with long positions accounting for roughly 90% of the losses.

• Top Liquidations:

• The largest single liquidation occurred on Binance, involving an ETH/USDT position worth $17.7 million.

• Over $300 million was liquidated in BTC and ETH trades alone.

Derivatives provider Greeks Live attributed the sharp correction to the simultaneous decline of major U.S. stocks like Nvidia and Tesla. They noted that the market sentiment has turned pessimistic, influenced by the strengthening U.S. dollar and falling stock prices.

Macroeconomic Pressures Weigh on Crypto

Experts suggest that the drop in crypto prices could be tied to hotter-than-expected U.S. jobs data, alongside rising prices reported in the ISM Purchasing Managers’ Index (PMI).

• Key Data Points:

• ISM Prices Paid: 64.4 (Actual) vs. 57.5 (Estimated).

• The metric reached its highest level since February 2023, fueling speculation about a delay in interest rate cuts.

Adam Cochran, a partner at CEHV, described the market’s reaction to the ISM PMI data as “nasty,” adding that it pushed investors to lower their expectations for upcoming rate cuts.

Meanwhile, 10x Research highlighted the growing importance of macroeconomic factors in driving Bitcoin’s price trends. They emphasized that the strengthening U.S. dollar and rising bond yields are creating headwinds for global liquidity, which directly impacts Bitcoin.

Altcoin Market Sees a Bloodbath

The sell-off wasn’t limited to Bitcoin. The broader cryptocurrency market shed $225 billion, dragging total market capitalization down by 7% to $3.53 trillion.

• Ethereum (ETH): Dropped 8% to fall below $3,400, erasing gains from the past five days.

• Major Altcoins: Many altcoins experienced double-digit losses, including:

• Dogecoin (DOGE)

• Avalanche (AVAX)

• Hyperliquid (HYPE)

• Pepe (PEPE)

• Near Protocol (NEAR)

• Bittensor (TAO)

The altcoin market remains highly volatile, bearing the brunt of the bearish sentiment sweeping through the space.

While Bitcoin and altcoins struggle to find footing, the crypto market’s fate appears increasingly tied to macroeconomic indicators and investor sentiment. As volatility reigns, traders are advised to tread carefully and stay informed about the broader economic landscape.