The cryptocurrency market experienced a significant downturn on Thursday, with the global crypto market capitalization dropping by over 4% to $3.65 trillion. Bitcoin's price fell below $108,000, and Ethereum's price dipped again under $3,700.
Approximately $180 billion was erased from the crypto market. Data from Coinglass revealed that over $1.2 billion was wiped out from leading crypto assets.
Major altcoins, including BNB, XRP, Solana (SOL), Cardano (ADA), and TRON, also saw substantial profit-taking. Meme coins such as Dogecoin (DOGE), Shiba Inu (SHIB), and PEPE experienced declines of more than 6%.
Crypto Market Crash Intensifies as $1.2 Billion in Liquidations Occur
CoinGlass data indicated that over $1.2 billion in cryptocurrency liquidations took place in the past 24 hours, affecting nearly 214,000 traders.
The largest single liquidation order for BTCUSD, valued at $21.42 million, occurred on Hyperliquid. This suggests that leverage-driven liquidations contributed significantly to the recent crypto market crash.
In total, approximately $980 million in long positions and over $160 million in short positions were liquidated. Notably, over $150 million in liquidations occurred within a single hour.
The cryptocurrencies most affected by liquidations in the past 24 hours included BTC, ETH, SOL, TRUMP, XRP, PUMP, ENA, DOGE, HYPE, and SUI.
Institutions Divesting from Spot Bitcoin and Ethereum ETFs
Institutional investors are reportedly selling their holdings in spot Bitcoin and Ethereum Exchange-Traded Funds (ETFs) in the United States.
According to SoSoValue data, spot Bitcoin ETFs in the U.S. recorded a total net outflow of $471 million. No inflows were observed across any of the 12 Bitcoin ETFs.
BlackRock's IBIT experienced an outflow of $88.1 million, while Fidelity's BTC ETF saw the highest outflow, amounting to $164.4 million.
Simultaneously, spot Ethereum ETFs registered total net outflows of $81.44 million. BlackRock's ETHA was the sole fund to record net inflows.
Glassnode data indicates a renewed sell pressure from traditional finance (TradFi) investors and a decline in institutional demand.
Within the first 30 minutes of trading, spot Bitcoin ETFs saw over $1 billion in trading volume.
Furthermore, the 24-hour average Coinbase premium index has turned negative. This suggests that U.S. buyers are not actively participating, and demand for spot Bitcoin ETFs is diminishing.
Crypto Market Braces for Monthly Options Expiry
The cryptocurrency market is anticipating significant volatility as more than $17 billion in crypto options are scheduled to expire on Friday.
The upcoming monthly options expiry, set for October 30, is considered a contributing factor to the day's Bitcoin price crash.
A total of 72,716 BTC call option contracts and 54,945 BTC put option contracts, valued at approximately $14.4 billion, will expire on Friday.
Additionally, $2.6 billion in ETH options are also set to expire on the same day.
Fed Chair Jerome Powell's Hawkish Stance Influences December Rate Decision
Despite President Donald Trump announcing a trade deal with China and a reduction in tariffs on various goods, the crypto market experienced a substantial decline.
Market experts attribute the downturn to disappointing earnings reports from major technology companies, hawkish remarks from Fed Chair Jerome Powell regarding the December interest rate decision, and the ongoing government shutdown.
The U.S. dollar index (DXY) rose to 99.66 following reports of a robust labor market. Concurrently, the U.S. 10-year Treasury yield saw a slight increase to 4.087%.
Bitcoin and Ethereum prices remain under pressure, reflecting increased caution among traders.
Crypto analyst Ali Martinez observed that Bitcoin's price tends to cycle between periods of high and low risk.
The Sharpe Ratio suggests that a shift towards a low-risk environment appears imminent, following a period of high-risk territory.