Bitcoin just fell off a cliff this Tuesday, dropping as low as $96,794, the first time it’s been below $100,000 since June. That’s over 20% down from the record high hit just a month ago, which would qualify as a bear market if this were stocks. The entire summer rally has basically been wiped out.
Ethereum got hammered even worse, sliding 15%, while many smaller altcoins posted similar losses. Some of these lesser-known tokens are now down over 50% for the year, which is absolutely brutal.
The turning point was October when that massive liquidation event wiped out billions in bullish positions. Since then, traders have been sitting on their hands. Bitcoin futures open interest is still way below pre-crash levels, and even though funding costs are favorable, nobody wants to jump back in. Result? Bitcoin’s up less than 10% this year, badly lagging stocks and once again failing as a portfolio hedge.
Chris Newhouse from Ergonia said Bitcoin’s decline reflects a market “still grappling with the psychological overhang” from October’s liquidation carnage. Tuesday saw about $1 billion in total liquidations, way down from the $19 billion record on October 10th.
Options traders are building serious downside hedges, with put contracts at the $80,000 strike price seeing the most demand. Bitcoin recovered slightly in Asian trading Wednesday, climbing back above $101,000.
Conclusion
Bitcoin fell below $100,000 to $96,794 for the first time since June, down over 20% from October’s record, as October liquidations left traders sidelined and futures open interest depressed.
Also Read: Stream Finance Freezes Funds
