Bitcoin Slips Below $104K as Crypto Market Extends Losses
Bitcoin fell below $104,000, marking a 17.5% decline from its peak earlier in October amid a broader market sell-off driven by a crisis in decentralized finance (DeFi) and macroeconomic concerns. Analysts attribute the current downturn to a combination of significant bad debt in the DeFi sector, which is estimated at $284 million, and fears surrounding the economy, including weak U.S. jobs data and a more hawkish Federal Reserve stance. Over the past 24 hours, liquidations in the crypto market exceeded $1.37 billion, indicating a growing bearish sentiment as investors unwind leveraged positions. This shift in market sentiment is exemplified by the decline in the annualized futures premium from 7% to below 4% and a drop in Greed index metrics among traders. Despite the short-term downturn, analysts suggest that this market realignment may lead to a more sustainable recovery, provided the DeFi issues are contained and clarity regarding macroeconomic conditions is achieved.
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