Bitcoin, the original cryptocurrency, saw its price drop to $95,234 on Friday at 9 a.m. in London, following a record high of just over $108,000 earlier in the week. The selloff also weighed heavily on smaller cryptocurrencies such as Ether and Dogecoin.
Source: Coinmarketcap
Adding to the bearish sentiment, US exchange-traded funds (ETFs) focused on Bitcoin experienced a record outflow of $680 million on Thursday. This marked the end of a 15-day streak of continuous inflows, according to Bloomberg data, highlighting a shift in market sentiment.
Strahinja Savic, head of data and analytics at FRNT Financial, described such corrections as “pretty typical” during crypto bull markets. Meanwhile, QCP Capital attributed the downturn to the market’s “overly bullish” positioning, which set the stage for a pullback.
Broader market trends also played a role. The Federal Reserve’s more hawkish stance on monetary policy, announced on Wednesday, impacted risk assets across the board. Despite the recent dip, Bitcoin remains nearly 50% higher since pro-crypto Donald Trump’s win in the U.S. presidential election on November 5.
Edward Chin of Parataxis suggested the selloff could be attributed to “year-end profit-taking,” rather than any fundamental change in the market.
The Fed’s revised outlook, with fewer rate cuts expected in 2025, has prompted some investors to reduce exposure and secure profits.
Chris Weston, head of research at Pepperstone Group, cautioned against short-term optimism, writing, “Technically, caution is warranted. While a price collapse is unlikely in the near term, the momentum has faded, and buyers have lost control of the market.”
