Major cryptocurrencies faced a significant downturn on Thursday, with liquidations surpassing $1.1 billion, predominantly affecting long positions. Bitcoin, the leading cryptocurrency, experienced a drop of 3.6% over the last 24 hours, trading at just under $109,554, and marking a nearly 7% decline for the week. Ethereum, the second-largest digital asset, plummeted by 7% to around $3,887, while Dogecoin, one of the most recognized meme cryptocurrencies, fell 7.6%, trading near $0.23.
Other notable cryptocurrencies were similarly hit hard, with Solana decreasing by 7.7% to $197.52. Both Solana and Dogecoin have seen declines of approximately 21% over the past week, making them the largest losers among the top 100 coins by market capitalization.
This downturn in the cryptocurrency market coincided with a broader decline in the stock markets, affecting major indices such as the S&P 500, Nasdaq, and Dow Jones Industrial Average. Data from CoinGlass indicates that over $1 billion of the total liquidations were related to long betting on future price increases in cryptocurrencies.
Analysts from Glassnode pointed to “signs of exhaustion” within the crypto markets. They noted that long-term holders have been taking profits, and the inflow of exchange-traded funds (ETFs) has started to slow. “Unless demand from institutions and holders aligns again, the risk of deeper cooling remains high,” they cautioned, adding that the current up cycle has lasted for 1,030 days—just shy of the 1,060 days observed in the previous two bull markets.
In the prediction market Myriad, a significant majority—70% of participants—expressed the belief that Bitcoin will drop to $105,000 before reaching $125,000, a stark prediction considering Bitcoin’s all-time high of $124,128 set in August.
Juan Leon, a senior investment strategist at crypto asset manager Bitwise, highlighted the adverse macroeconomic factors impacting the crypto space. He pointed to concerns surrounding a potential U.S. government shutdown, rising geopolitical tensions, and a fragile job market that could complicate prospective interest rate cuts. “Bitcoin and other crypto assets were already hovering in uncertain territory, and so investors were skittish,” he explained, suggesting that safety-driven selling is occurring as a response to these uncertainties.
Despite the recent price drop, Leon maintained that he does not view current prices as having peaked. He pointed to the enactment of the Genius Act, the anticipated passage of further crypto-friendly legislation, and increasing institutional interest in digital assets. “This cycle is fundamentally different from past cycles,” he said, noting the ongoing regulatory clarity and the shift towards institutional adoption rather than retail-driven enthusiasm.
As analysts look ahead, attention is focused on the upcoming release of the Personal Consumption Expenditures Price Index (PCE), a key measure monitored by the Federal Reserve. An increase in the PCE could lead to another interest rate cut, which traditionally benefits Bitcoin and other risk assets by increasing market liquidity.
