Simply put
- Macroeconomic uncertainty is causing anxiety among investors.
- Liquidations have soared to over $900 million in the last 24 hours, with long positions accounting for more than $550 million.
- Key stock indexes closed the day in the red.
Late Monday, Bitcoin and other leading cryptocurrencies deepened their losses, a trend attributed to a widespread retreat from riskier assets. Investors have been rattled by uncertainties in the macroeconomic landscape, particularly around U.S. interest rates and significant tech companies ramping up their artificial intelligence investments.
Bitcoin is now trading around $92,200, reflecting a 2.3% drop over the last day, marking its lowest point since late April, according to data from CoinGecko.
Over the past two weeks, Bitcoin has plummeted over 14%, impacting profits for 2025 as well.
“Current sell-offs in digital assets reflect a broader trend of risk aversion as macro challenges build up,” noted Juan Leon, an investment strategist at Bitwise, in an email. “The market is adjusting its liquidity expectations, especially given the lower likelihood of a rate cut in December. This sentiment is heightened by the risk-off dynamics stemming from declines in the AI sector, affecting all risk assets.”
Concerns surrounding rising prices, the U.S. trade war, missed projections in the October jobs and inflation reports, coupled with a slowing U.S. economy, have also unsettled the markets. This has led many to rethink the potential benefits of rate cuts for markets seeking more liquidity.
On Monday, major companies like Google and Microsoft were also in focus as they continue to invest heavily in AI projects, which raise questions about their immediate financial impact.
Ethereum, the second-largest cryptocurrency by market cap, is hovering around $3,000, down 2% since Sunday. It briefly dipped to $2,960, its lowest value in four months. Other cryptocurrencies like Solana, Dogecoin, and XRP also experienced declines of 4.4%, 3.7%, and 2%, respectively.
The Nasdaq and the S&P 500 tech indexes continued their recent downward trajectories, each down about 1% on the day.
Stocks related to cryptocurrencies fell as well, with Coinbase experiencing a more than 7% decline.
In the past 24 hours, over $900 million in positions were liquidated, including long positions worth over $550 million, according to Coinglass.
Maja Vujinovic, CEO of Ethereum Treasury FG Nexus, explained, “Some large holders and miners have been selling more aggressively, and when the price broke a critical support level, leveraged long positions were liquidated across the derivatives market, pushing the prices lower.”
“This looks more like a short-term de-risking or repositioning rather than a fundamental shift,” she added.
Myriad’s prediction markets indicated that 60% of respondents believe Ethereum may trend down to $2,500 instead of rising to $4,000, reflecting a pessimistic shift in sentiment about the virtual currency market.
In a contrasting note, Stephane Ouellette, CEO and co-founder of FRNT Financial, which specializes in cryptocurrencies, expressed a more optimistic view. He mentioned that Bitcoin is close to the upward trend line from the bull market that began in October 2024.
“This correction could be viewed as a ‘normal progression,” he said. It’s common in the crypto market for prices to drop sharply and then bounce back quickly.”
He further explained, “Our model indicates we are at about the midpoint of the market cycle, and we haven’t yet observed the extreme values and trading volumes typical of price peaks from 2017 and 2021.”
