(Bloomberg) — After a weeklong rout that wiped hundreds of billions of digital asset value, Bitcoin (BTC-USD) has yet to live up to its reputation as a safe-haven asset.
Once intended as a hedge against market turmoil – a “digital gold” for the blockchain era – the original cryptocurrency continued its slide on Friday, falling as much as 4% to $103,550, the lowest level since June. Ether, the second largest token, fell below $3,700 and is now down about 25% from its August high.
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The total value of the crypto market has declined by more than $600 billion since last Friday, according to data compiled by CoinGecko.
Meanwhile, Binance-linked BNB token fell 11% on Friday, before paring its decline. The world’s largest cryptocurrency exchange was cited by analysts as a key driver of the record wave of liquidations on October 10 and 11, as users faced technical issues and price discrepancies. Binance offered customers and businesses nearly $600 million in compensation following the crash.
BNB’s fall on Friday “seems to match the sell-off in the market at the moment,” said Yoann Turpin, co-founder of crypto market maker Wintermute. The activity is also likely a sign of price revisions, Turpin said, after a midweek rise failed to form a lasting recovery.
Bitcoin hit an all-time high of $126,251 on October 6. Days later, more than $19 billion in liquidations triggered by escalating U.S.-China trade tensions coincided with a sharp selloff that affected most major tokens. According to Coinglass data, around $1.2 billion in leveraged positions were liquidated in the past 24 hours, which is well below last week’s total but highlights that leverage remains high in a fragile market.
Heavyweights like Kraken, Circle, BitGo and Ripple are diving deeper into regulated finance, seeking trust charters, payment rails and card products.
“What is striking is the timing of the crash coincides with the time when major players are seeking banking licenses,” said Rachael Lucas, an analyst at BTC Markets. The pivot to traditional financial infrastructure “signals a strategic hedge against volatility, aimed at strengthening legitimacy,” she added.
Risks from US-China trade conflicts continue to weigh on risk assets beyond crypto.
