Bitcoin heading for worst month since crypto collapse of 2022.
Bitcoin is on track for its worst monthly performance since a string of corporate collapses rocked the wider crypto sector in 2022.
The largest cryptocurrency slid as much as 6.4% to US$81,629 on Friday. Runner-up ether fell as much as 7.6% to below US$2,700 and a host of smaller tokens nursed similar declines. The total market value of virtual coins dropped below US$3 trillion (RM12.4 trillion) for the first time since April, data from CoinGecko show.
Bitcoin has now shed about a quarter of its value in November, the most for a single month since June 2022. The implosion of Do Kwon’s TerraUSD stablecoin project in May of that year sparked a daisy chain of corporate failures that culminated in the downfall of Sam Bankman-Fried’s FTX exchange.
Despite a pro-crypto White House under US President Donald Trump and surging institutional adoption, bitcoin has plummeted over 30% since rocketing to a record in early October. The rout follows a crippling bout of liquidations on Oct 10 that wiped out US$19 billion in leveraged token bets, and in turn erased roughly US$1.5 trillion from the combined market value of all cryptocurrencies.
The selling pressure has intensified in the past 24 hours, with a further US$2 billion in leveraged positions liquidated, according to data from CoinGlass. Bitcoin was trading at around US$82,900 as of 6:15am in New York.
The broader market backdrop has done little to help. US stocks, which had rallied on renewed enthusiasm for artificial intelligence after upbeat earnings from Nvidia Corp, surrendered gains late Thursday amid concerns over stretched valuations and doubts about a Federal Reserve rate cut in December.
A gauge of crypto investor sentiment that measures factors such as volatility, momentum and demand also hits its lowest level since the 2022 meltdown. The index, compiled by Coinglass, is currently indicating “extreme fear” among traders. It stood at 94 just after Trump won the presidential election just over a year ago.
Institutions appear reluctant to buy into the weakness. A group of 12 US-listed bitcoin exchange-traded funds saw US$903 million in net outflows on Thursday, their second-largest single-day redemption since debuting in January 2024. Open interest in perpetual futures has fallen 35% from its October peak of US$94 billion.
Source: Theedgemalaysia