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“Bitcoin and crypto have generally enjoyed a positive correlation with good times in stocks, so they have not become an alternative value asset to hedge against fear in other sectors,” said Juan Perez, director of trading at Monex USA in Washington.
“If there is no enthusiasm for risk-taking, it seems that that also translates into hesitancy towards bitcoin and so on.”
Markets are now pricing in a roughly 40% chance of a rate cut in December, up from around 90% earlier this month and just over 60% earlier this week.
By early afternoon, bitcoin, the world’s largest cryptocurrency, lost 2.3% to $96,564, after falling to $95,885.33, its lowest level since May 7.
Ether, the second-largest cryptocurrency, was last stable on the day at $3,175.22, after falling to a 10-day low.
Dave Rosenberg, founder and president of Rosenberg Research, said bitcoin was “officially in bear market territory, having fallen more than 20% in just over a month.” He also pointed to huge redemptions of exchange-traded funds, totaling $870 million on Thursday alone.
Since its peak on October 7, the market capitalization of cryptocurrencies has fallen by more than $1 trillion, or 24%.
The Bitcoin context remains bearish, according to analysts.
Long-term bitcoin holders have accelerated their profit-taking, according to crypto research firm Glassnode. These long-term bitcoin holders sold 815,000 bitcoins in the past 30 days, the most since January 2024, according to CryptoQuant, another digital asset research firm.
Reporting by Gertrude Chavez-Dreyfuss in New York and Samuel Indyk in London; Editing by Dhara Ranasinghe and Richard Chang
Our Standards: The Thomson Reuters Trust Principles.
