The cryptocurrency market experienced a sharp sell-off recently, wiping out $250 billion in value within 24 hours. Bitcoin (BTC), the leading digital asset, plunged from $102,000 to $96,000—a significant downturn.
What triggered this drop? Below, we analyze the key factors behind Bitcoin’s price decline and its implications for the broader crypto market.
Key Reasons for the Bitcoin Price Drop
Inflation Concerns
Bitcoin’s price decline coincided with rising U.S. Treasury yields, fueled by stronger-than-expected PMI data. The Institute for Supply Management reported a jump to 54.1 in December, up from 52.1 in November, indicating unexpected growth in the U.S. services sector.
This stoked fears of persistent inflation, potentially delaying anticipated Federal Reserve rate cuts. Higher yields often pressure risk-sensitive assets like cryptocurrencies.
Job Market Uncertainty
The November JOLTS report revealed mixed signals: job openings increased, but hiring slowed. Worker confidence also dipped, with the quit rate falling to 1.9% from 2.1% in October. These conflicting labor market trends added to investor anxiety, exacerbating the downturn.
$561 Million in Liquidations Within 24 Hours
The market slump triggered massive liquidations, intensifying selling pressure. Long positions worth $561 million were liquidated in a single day. The largest single liquidation occurred on Binance, involving a $17.74 million ETHUSDT trade.
Other major cryptocurrencies also suffered:
- Ethereum (ETH): Down 8%
- Solana (SOL): Dropped 9%
- XRP: Fell 5%
Bitcoin ETFs Face Heavy Outflows
The price decline reversed inflows into Bitcoin ETFs. After two days of positive momentum, ETFs saw outflows of $543.7 million on January 7. Major outflows came from Ark Investment, Grayscale, Bitwise, and Fidelity—firms previously bullish on Bitcoin ETFs.
What’s Next for Bitcoin?
According to Glassnode analyst James Check, Bitcoin’s sell pressure is easing, but demand growth has stalled. Spot trading volumes have declined by 53% since November, reflecting reduced market activity.
👉 Will Bitcoin rebound or decline further?
Key levels to watch:
- Support: $95,668 (critical hold level)
- Resistance: $100,000 (psychological target)
A break below support could push Bitcoin toward $93,625, while renewed momentum might reignite the rally toward $100,000.
FAQs
How much will 1 Bitcoin be worth in 2025?
Projections suggest BTC could peak at $169,046 (Coinpedia).
How much will $1 Bitcoin be worth in 2030?
By 2030, 1 BTC might reach $610,646.
What will Bitcoin be worth in 10 years?
With global adoption, Bitcoin could surpass $1 million per coin by 2030.
👉 Stay updated with real-time crypto trends
Support levels are in focus—will Bitcoin recover or face further declines? The next move is critical.
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