Bitcoin has suffered a sharp sell-off, briefly falling below US$62,000 and prompting a wave of forced liquidations that wiped out more than A$2.3 billion in a single day. More than 208,000 traders were liquidated during the move, according to CoinGlass, with Bitcoin accounting for more than US$800 million in losses and Ethereum another US$386 million. The drop marks Bitcoin’s steepest decline in months and has shaken market confidence after a period of record highs and rising Wall Street interest.
The latest weakness has been accompanied by a sustained outflow from US spot Bitcoin exchange-traded funds, with investors withdrawing about US$1 billion this week alone. That has extended the funds’ worst run of net outflows since launch and raised fresh questions about whether institutional demand is softening. Some analysts, including research firm Presto, said the pullback may reflect a broader shift in risk appetite rather than a problem unique to crypto, pointing to geopolitical tensions and changing expectations for US interest rate cuts.
Market behaviour on Deribit, the world’s largest crypto options exchange, also signals growing caution. The most actively traded contract in the past 24 hours was a US$50,000 put option expiring later this month, a sign traders are seeking protection against further downside. Other popular bearish positions were clustered around US$65,000 and US$55,000, while only one bullish US$80,000 contract appeared among the most active trades. The pattern suggests that short-term sentiment has turned notably defensive.
The sell-off has revived debate over Bitcoin’s long-term value and resilience. Critics say the cryptocurrency remains vulnerable to abrupt declines because it lacks the protections and stability of traditional financial assets. Long-time Bitcoin critic Peter Schiff argued that the market is far from a bottom, warning on social media that a break below US$50,000 could trigger a much steeper collapse. He said such a move could shake the confidence of long-term holders and force many to exit the market.
Schiff also questioned whether Bitcoin’s decline could be an early warning sign for broader financial markets, particularly risk assets. He suggested investors may increasingly move toward safer assets such as gold and value stocks if uncertainty around inflation, interest rates and geopolitical tensions continues to rise.
Despite the heavy losses, Bitcoin is still trading well above the lows seen during previous crypto bear markets. Supporters of the asset continue to argue that short-term volatility is part of its evolution as a new financial technology. For now, attention is focused on whether the US$60,000 support level can hold. If that level fails, analysts warn that another wave of selling could follow, potentially pushing Bitcoin lower and deepening the current correction.
