Bitcoin has fallen sharply to its weakest level since May, slipping to around $94,000 on Friday as investors retreat from risk assets amid growing fears that the U.S. Federal Reserve may delay its long-anticipated rate cuts. The cryptocurrency, which hit an all-time high of $126,296 in October, has now lost nearly a quarter of its value in just over a month.
By midday, bitcoin was fluctuating between $94,000 and $97,000 before stabilising near $94,850. Analysts say the plunge reflects a combination of global macroeconomic jitters and deep internal market pressures, both of which have intensified over the past two weeks.
The collapse comes after traders sharply reduced their expectations of a December Fed rate cut. What had been a near-certain 97% probability has now fallen to about 50%, triggering a broad deleveraging across tech stocks, crypto assets and other high-risk instruments. The U.S. Volatility Index (VIX) has surged to its highest level since mid-October, underscoring heightened market anxiety.
Fresh data from CryptoQuant shows that long-term bitcoin holders have offloaded roughly 815,000 BTC in 30 days, the biggest wave of profit-taking since early 2024. The sell-off has coincided with sustained outflows from U.S.-listed spot bitcoin ETFs, draining liquidity and amplifying downward pressure.
The turbulence has spilled into equities linked to the digital-asset ecosystem. Shares of Tesla, Nvidia, Palantir, Coinbase and several bitcoin-mining firms came under heavy strain this week as investors ditched speculative assets and repositioned portfolios ahead of uncertain U.S. economic data following the 43-day government shutdown.
The technical picture paints a complicated outlook. Bitcoin has slipped below its closely watched 365-day moving average, hovering near levels that analysts warn could determine whether the current decline evolves into a deeper correction. Researchers at Bitfinex say the 22% drawdown from the October peak mirrors typical mid-cycle retracements seen throughout the 2023–2025 bull run, suggesting that the current drop remains within historical norms.
Despite the volatility, Glassnode notes that around 72% of all bitcoin in circulation is still in profit, highlighting that many long-term holders retain substantial gains. The analytics firm says whale selling appears consistent with late-cycle behaviour rather than panic, with large holders realising profits at an accelerating but historically normal pace.
JPMorgan analysts point to another key factor: production cost. With network difficulty rising, they estimate bitcoin’s current production cost sits near $94,000; a level that has historically acted as a strong downside anchor. With the spot price now hovering at $95,670, they argue that bitcoin’s price-to-cost ratio has returned to lows typically seen before rebounds. The bank maintains a medium-term bullish target of around $170,000 over the next 6–12 months.
Yet the market remains sensitive to broader global uncertainty. The U.S. reopened this week after its longest-ever shutdown, but the temporary funding measure approved by President Trump only covers federal operations until January 30, leaving investors wary of further disruption early next year.
For now, bitcoin is struggling to reclaim the $100,000 threshold, with sentiment fragile and momentum weighed down by reduced institutional buying, ETF outflows and a risk-off mood that has swept across global markets.
Crypto Market Update: Bitcoin slides below $98K amid US$1.1B liquidations
