Kyiv • UNN
Bitcoin fell to $67,628, losing as much as 9% over two days. Outflows from U.S. bitcoin ETFs exceeded $2.5 billion.
On Friday, November 13, bitcoin fell below $70,000 for the first time since August. In two days, the largest cryptocurrency lost up to 9% of its value amid concerns about inflation and a possible interest rate hike by the U.S. Federal Reserve (Fed). Bloomberg reports, UNN writes.
Details
During trading, bitcoin fell 5.4% to $67,628. This was its lowest level since August 19. The day before, the cryptocurrency had already lost 3.8%. The price later partially recovered, reaching about $69,200 at the start of morning trading in New York.
According to CoinGlass, about $1.5 billion worth of long positions in the cryptocurrency market were liquidated over 24 hours. The forced sale of assets by traders using leverage intensified the decline.
As noted by Sean McNulty, a derivatives trader at market maker AQC Tech, after the $70,000 level was breached, more than $1 billion worth of leveraged long positions were forcibly closed, creating additional pressure on the market.
Ether, the second-largest cryptocurrency by market capitalization, fell 6% and again dropped below $2,000.
Inflation increases pressure on the cryptocurrency market
Macroeconomic risks were among the key factors behind the decline. High oil prices and persistent inflation are strengthening expectations of further Fed interest rate hikes.
In October, the U.S. core consumer price index, excluding food and energy, rose 0.3% from the previous month. The figure exceeded forecasts for the third consecutive month. Overall inflation stood at 0.4% month over month.
BTSE cryptocurrency exchange Chief Operating Officer Jeff Mei noted that a possible 50-basis-point Fed rate hike instead of the expected 25 basis points could trigger further declines in bitcoin and other cryptocurrencies.
The strengthening U.S. dollar and instability in the artificial intelligence market are creating additional pressure on risk assets. According to Rich Rosenblum, co-founder of cryptocurrency market maker GSR, these factors led to the closure of some long bitcoin positions. He also cited high inflation figures and changes in Nvidia's leadership among the other reasons.
Institutional investors are reducing investments
Pressure on the cryptocurrency market is intensifying due to outflows from investment products. According to the report, institutional buyers reduced their activity over the past two weeks.
In particular, since October 30, U.S.-listed spot bitcoin exchange-traded funds (ETFs) have recorded net outflows of more than $2.5 billion.
Bitcoin posted its weakest October in 12 years, falling by more than 7%03.11.26, 11:09 • 4715 views
