Bitcoin fell below $100,000 on Tuesday for the first time since June, sparking a broad selloff across digital asset markets that erased over $1 trillion in total cryptocurrency value since early October.
The world’s largest cryptocurrency briefly declined to $99,010 before stabilizing around $102,000 later in the day. The move represents a roughly 20% fall from its record high of $126,000 reached on October 6, pushing Bitcoin into what analysts describe as bear market territory.
Large-Scale Liquidations Amplify Price Decline
The sharp drop triggered widespread liquidations in the derivatives market, with more than $1.3 billion in leveraged positions closed across major exchanges within 24 hours. Data from Coinglass indicated that nearly 90% of those liquidations involved long positions, traders betting on continued price increases, underscoring the extent of leverage in the system.
Ethereum, the second-largest cryptocurrency, also faced significant pressure, falling more than 20% over two days to trade below $3,200. Roughly $1 billion worth of Ethereum-linked derivatives positions were liquidated, sending the token’s year-to-date performance into negative territory.
Other major assets including Solana, XRP, and Dogecoin recorded declines ranging from 18% to 22%, collectively erasing about $100 billion from overall crypto market capitalization in a single day.
Leverage and Technical Factors Drive the Downturn
Market observers attributed the steep decline primarily to excessive leverage rather than a shift in long-term fundamentals. According to The Kobeissi Letter, “the crypto markets have now erased over $1 trillion of market cap since October 6,” with elevated leverage levels “amplifying price movements.”
The selloff intensified when Bitcoin dropped below a key technical support level near $109,000, prompting forced selling from overleveraged traders. Broader market sentiment was also affected by Federal Reserve Chair Jerome Powell’s recent remarks suggesting that December rate cuts are not guaranteed, reducing investor appetite for risk assets.
Institutional Interest Remains Stable
Despite the correction, institutional demand appears to be holding steady. Bitcoin exchange-traded funds (ETFs) have collectively added around 50,000 BTC over the past month, indicating continued inflows from large investors even as volatility increases.
Analysts note that while the current downturn reflects short-term deleveraging, it may also serve as a consolidation phase following months of sustained price gains across the cryptocurrency sector.
