Bitcoin continued its slide from a record high this week, falling nearly 15% as hawkish signals from the Federal Reserve prompted traders to sell an asset that has more than doubled in price this year.
The leading digital currency fell as much as 5% to $92,600 on Friday morning in New York, after hitting an all-time high above $108,000 earlier in the week. The drop weighed more heavily on smaller cryptocurrencies such as ethereum and dogecoin, while stocks in Asia and Europe also fell.
Outflows
A group of U.S.-based exchange-traded funds that invest directly in bitcoin ended a 15-day streak of positive inflows on Thursday, posting a record $680 million in outflows, data showed, reflecting a shift in investor sentiment.
The sharp swings come after a rally in digital assets following Donald Trump’s victory in the US presidential election on November 5. According to QCP Capital, the sentiment has become “overly bullish,” making digital assets vulnerable to any change in the tone of the Federal Reserve, which is increasingly focused on bringing inflation back to target.
The uncertainty in crypto markets looks set to continue through the holidays, as Trump prepares to take office and threatens to impose tariffs on U.S. allies and adversaries. With the Fed likely to slow its easing pace, the focus is shifting to how quickly traditional financial firms embrace the asset.
“The interplay between monetary policy, institutional adoption, and political developments suggests that Bitcoin will remain sensitive to general and crypto-specific economic stimuli through 2025,” Hany Abu Ghala, senior market analyst at XTB, said in a note on Friday.
Open interest in CME Group's bitcoin futures contracts approached a record high on Tuesday but has since declined.
“Technically, caution is advised in the short term,” Chris Weston, head of research at Pepperstone Group, wrote in a note. “This does not mean we are about to see a price breakdown anytime soon, but the momentum that was driving the move has clearly waned, and buyers have lost control of the market.”
Read also: Bitcoin loses 10% of its value and falls to this level after a record rise
Cryptocurrencies Now
Altcoins have seen significant declines in their market value in recent hours, with most currencies recording price declines amid significant market volatility.
Ripple (XRP): Down 9.31% to $2.1576.
Binance Coin (BNB): Down 7.62% to $645.24, indicating clear selling pressure.
Solana (SOL): It suffered a massive drop of 11.69%, settling at $183.408.
Dogecoin (DOGE): Down 20.42% to $0.288068.
Cardano (ADA): It fell by 14.60% to $0.8250, reflecting its impact from the prevailing market volatility.
Tron (TRX): Down 10.40% to $0.236550.
Avalanche (AVAX): Down 15.69% to $35.81.
