Summary
- Bitcoin’s price fell below the $110,000 mark, indicating continued weakness.
- Weakened expectations for rate cuts, disagreements within the Federal Reserve, and uncertainty about this week’s inflation data are affecting investor sentiment.
- In the cryptocurrency derivatives market, large-scale liquidation of long positions has exerted additional downward pressure.
The leading cryptocurrency, Bitcoin, dropped below the $110,000 mark amid a broad decline in major cryptocurrency prices.
According to U.S. cryptocurrency exchange Coinbase on the 25th (local time), as of 5:07 pm Eastern Time (1:44 pm Pacific), the price of one Bitcoin was $109,713, down 2.57% from 24 hours ago.
This is the first time since the 2nd that Bitcoin has fallen below the $110,000 mark. Bitcoin’s price has returned to levels seen on January 20, the inauguration date of President Donald Trump. Compared to its all-time high of around $124,500, Bitcoin has fallen by more than 11%.
Altcoins saw even steeper declines. Ethereum, which broke through $4,900 for the first time in about four years to set a new high as the second-largest cryptocurrency by market cap, fell below the $4,400 level. Its price dropped 8.65% to $4,361.
XRP (Ripple), ranking third by market capitalization, declined 6.15% to $2.84, substantially below the $3 mark. Solana and Dogecoin also plunged by 8.16% and 10.76%, trading at $187 and $0.21, respectively.
Since U.S. Federal Reserve Chairman Jerome Powell hinted at the possibility of monetary policy easing in September on the 22nd, cryptocurrencies initially responded positively, but the waning hopes for rate cuts reversed the rallies, sending prices lower.
Bloomberg news agency reported, "There are downside risks in the labor market, but questions remain regarding the pace of (interest rate) cuts," and added, "With differing opinions within the Fed, investors are nervous ahead of this week’s release of potentially unfavorable inflation data."
Large-scale leveraged trading positions being liquidated in the cryptocurrency derivatives market have also fueled the decline. According to data from cryptocurrency analytics firm CoinGlass, about $700 million worth of trades were forcibly liquidated in a single day. Of this, about $627 million were long positions betting on price increases.
Lee Song-ryeol, Hankyung.com reporter yisr0203@hankyung.com
Korea Economic Daily
hankyung@bloomingbit.ioThe Korea Economic Daily Global is a digital media where latest news on Korean companies, industries, and financial markets.
