Bitcoin falls to $86,000… Ethereum also down more than 7%

Strategy indicates "sell tokens if net asset value turns negative"

Largest monthly outflow from bitcoin ETFs in November

U.S. bitcoin ETFs saw a record monthly outflow last month, and bitcoin again fell on the 1st to the low $86,000 (about 126,460,000 won). Ethereum also fell more than 7% to about $2,800. Most other cryptocurrencies also declined.

Bitcoin fell to $86,000 in early Asian trading that day. It later recovered some of the losses and was trading around $86,788 in European trading at 10 a.m. London time.

According to LSEG data, U.S. ETFs based on spot bitcoin saw outflows of $3.43 billion (about 5 trillion won) during November. U.S. bitcoin ETFs have seen net inflows of $21 billion (about 30 trillion won) so far this year.

Accordingly, bitcoin fell 16.7% in November alone. The cryptocurrency market has been shaken by selling that began after around $19 billion in leveraged bets were liquidated in early October.

Sean McNulty, head of derivatives trading at FalconX, said, "The biggest concern is that inflows into bitcoin exchange-traded funds (ETF) are minimal and there are no buyers at the lows." He predicted that this kind of structural supply-demand instability would continue this month. He said the next major support level is $80,000.

That day, Fong Le, CEO of Strategy, a prominent bitcoin financial company, also influenced markets by saying on a podcast last weekend, "If the company's mNAV (ratio of bitcoin holdings to enterprise value) turns negative, we may sell tokens."

He added, "If dividends have to be paid at below 1x mNAV, we will sell bitcoin," and said this would be a "last resort." According to Strategy's website, Strategy's mNAV plunged to 1.19; Strategy currently holds $56 billion (about 82 trillion won) worth of bitcoin.

Meanwhile, S&P Global Ratings downgraded the stability rating of the world's largest stablecoin, USDT, to the lowest grade last week. It also warned that a decline in bitcoin's value could lead to collateral shortfalls.

On the 29th, the People's Bank of China issued a warning about the risks of cryptocurrencies, including stablecoins.

Jeff Ko, chief analyst at CoinX, said that the downgrade of USDT's rating and the People's Bank of China's warning have increased pressure on cryptocurrencies again.

For the time being, the momentum that could support bitcoin's price is whether the U.S. Federal Reserve will cut interest rates. In the early morning Eastern Time, according to CME Group's FedWatch, the interest rate swaps market estimates an 86% chance of a 0.25% rate cut this month.

According to CoinGecko, the total value of the cryptocurrency market once reached about $4.3 trillion in mid-October, but since then more than $1 trillion in value has evaporated.

Kim Jeong-a, contributing reporter kja@hankyung.com