Bitcoin’s price recently dropped below $86,500, wiping out $144 billion from the global cryptocurrency market within four hours. This decline was driven by macroeconomic pressures and a hack attack on the Yearn Finance platform, prompting investors to avoid risks. According to CryptoAppsy data, Bitcoin fell by 5.34% in the last 24 hours to $85,910, with Ethereum, XRP, and Solana also experiencing notable declines to $2,827, $2.02, and $126 respectively.
Macroeconomic Pressure and ETF Exits Deepen the Sell-Off
Analysts indicate that the wave of selling hitting Bitcoin and other cryptocurrencies created a “position cleansing” effect in the market, despite expectations of interest rate cuts. The CME FedWatch Tool shows an 87.6% probability of a 25 basis point rate cut in December. However, BTC Markets analyst Rachael Lucas believes that the hope for an interest rate cut alone is insufficient to change the market direction. Lucas notes that high inflation and rumors of import tariffs have suppressed risk appetite, resulting in $3.5 billion exiting ETFs throughout November.
Lucas stated, “Bitcoin is behaving like a high-beta asset again; it needs more than just ‘dovish’ expectations, it requires actual liquidity injection.” She identifies $87,000 as a critical short-term threshold, suggesting that if it holds, a recovery towards the $95,000–$100,000 range is possible, but a loss could lead to a fall to $80,400 or even $75,000.
Yearn Finance Attack Amplifies Panic
Another factor accelerating Sunday night’s sell-off was the attack on the yETH pool of the DeFi protocol Yearn Finance. The attackers transferred 1,000 ETH via Tornado Cash, causing widespread concerns in the decentralized finance sphere. BTSE COO Jeff Mei highlighted that Yearn acts as an aggregator in protocols like Aave, Compound, and Curve, stating, “The fear of mass liquidation among investors triggered panic selling.”
Analysts suggest that a recent hack on the Upbit exchange damaged the market’s confidence perception, amplifying its impact during weekend trading hours. Meanwhile, U.S. President Donald Trump announcing the new Fed chair bolstered interest rate cut hopes. According to Tribe Capital executive Boris Revsin, the market has not priced in the likelihood of the new chair adopting a liquidity-friendly approach yet.