- In the past hour, roughly $517.1k in Bitcoin has been liquidated across the crypto market, as reported by CoinGlass.
- Despite the wave of liquidations, overall market sentiment has not experienced a drastic downturn.
- Bitcoin’s decline is primarily driven by robust U.S. economic data, which suggests the potential for further interest rate hikes.
Bitcoin investors withdrew nearly $570 million from U.S. listed spot Bitcoin exchange-traded funds (ETFs) on January 8, as the cryptocurrency’s price fell below the critical $100,000 mark, triggering a wave of liquidations.
Spot Bitcoin ETFs recorded $569.1 million in outflows that day, marking the second-largest daily net outflow since their inception. This figure was only $100 million short of the record $671.9 million outflow on December 19, according to data from Farside.
The Fidelity Wise Origin Bitcoin Fund accounted for approximately 45% of the daily outflows, with $258.7 million being withdrawn. It’s the highest single-day outflow to date.
The Liquidation
In the past hour, roughly $517.1k in Bitcoin was liquidated across the cryptocurrency market, as reported by CoinGlass. Bitcoin’s price briefly dropped to $92,500, largely influenced by concerns surrounding the U.S. Federal Reserve’s anticipated monetary tightening in 2025, according to Ryan Lee, chief analyst at Bitget Research.
“Bitcoin’s decline is primarily driven by robust U.S. economic data, which suggests the potential for further interest rate hikes,” Lee explained. As of this writing, Bitcoin is trading at $93,494, based on CoinMarketCap data.
The U.S. government recently liquidated an astounding 69,370 Bitcoins, valued at approximately $6.7 billion. According to Arkham Intelligence, the balance in the government’s cryptocurrency wallet dropped from $6.7 billion to zero on January 8, shortly after reports surfaced. Following its failure to break past the $100,000 level, Bitcoin has encountered significant selling pressure, wiping out its weekly gains.
State of Greed in the Market
Despite the wave of liquidations, overall market sentiment has not experienced a drastic downturn. The Crypto Fear & Greed Index, which measures sentiment across Bitcoin and other cryptocurrencies, currently reflects a “Greed” score of 69. This is a slight drop from the “Extreme Greed” score of 78 recorded a month ago.
Some analysts caution against drawing conclusions too early based on Bitcoin’s recent volatility. In a January 9 post on X, trader Daan Crypto Trades remarked, “This doesn’t say much yet, especially since December broke the trend, and the start of the year is typically very volatile.”
Daan noted that while Bitcoin reached a “local top” earlier this month at $102,500, it dropped to a new monthly low of $92,500 on January 8. “It’s been a pretty indecisive start to the year so far,” he added.
