[Market] Bitcoin falls below $71,000…Lowest level since October 2024

YM Lee

Summary

Bitcoin (BTC) slid to below $71,000, its lowest level since October 2024, down 7.2%, weighing on investor sentiment.
Vincent Liu said downside pressure accelerated as key support broke alongside large-scale long-position liquidations, a sharp drop in U.S. equities, and spot ETF outflows.
Peter Chung and Liu said that even amid Extreme Fear, traditional investors have yet to fully enter the market, leaving medium- to long-term potential demand; they cited the $70,000 support level and stabilization in ETF flows as key to easing selling pressure.

Bitcoin fell below the $71,000 mark amid growing global risk-off sentiment, sliding to its lowest level since October 2024.

According to The Block on the 5th (local time), Bitcoin (BTC) dropped about 7.2% over 24 hours to as low as $70,894. At the same time, Ethereum (ETH) fell 7.8% to trade at $2,091.

The decline is seen as losses widening after key support levels broke down following a failed attempt at a short-term rebound. Vincent Liu, chief investment officer (CIO) at Kronos Research, said, "After the short-term rebound, it failed to hold key support levels, and downside pressure accelerated as large-scale long-position liquidations, a sharp drop in U.S. equities, and spot ETF outflows converged."

Crypto-related stocks also weakened in tandem. Shares of Coinbase, the largest U.S. crypto exchange, closed down 6.14% on the day, while BitMine, an Ethereum treasury company, plunged 9.17%. The Nasdaq Composite fell 1.51%, while the Dow Jones Industrial Average rose 0.53%.

Markets are viewing this pullback less as a crypto-specific issue and more as an extension of a macro-driven shift toward risk aversion. Peter Chung, head of research at Presto Research, said, "The current price action in crypto is moving in lockstep with the broader risk-asset correction, including tech stocks," adding, "With Bitcoin sliding to a year-to-date low, investor sentiment is at its most depressed since the last bear market."

The Crypto Fear & Greed Index stands at 12, remaining in the 'Extreme Fear' zone.

Still, some warn against excessive pessimism. Chung said, "If you look past the short-term noise, most traditional investors still have not entered the crypto market in earnest," adding, "There is still potential demand over the medium to long term."

On the path ahead, Liu added, "The key is whether Bitcoin can defend the psychological support level around $70,000," and noted that "if liquidations are absorbed, investor sentiment recovers, and ETF fund flows stabilize, selling pressure could ease."

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