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Bitcoin, Ethereum Fuel $800M Crypto Liquidations After Fed Warning

Bitcoin Falls, Sparks $800 Million in Crypto Liquidations After Powell’s December Warning

  • Over $800 million in crypto positions were liquidated in 24 hours, with Bitcoin and Ethereum leading the losses.
  • Bitcoin dropped to $111,000 after the Federal Reserve indicated a December rate cut is uncertain.
  • XRP experienced the steepest decline among major digital assets, while Binance Coin posted slight gains.
  • Market sentiment shifted on several tokens, but overall crypto market capitalization declined by 2.1%.
  • Spot Bitcoin ETFs in the U.S. saw significant net outflows, reflecting weaker institutional demand.

A sharp downturn swept across cryptocurrency markets after the U.S. Federal Reserve sent signals that an interest rate cut in December remains uncertain. On Thursday, Bitcoin fell to $111,000 as widespread liquidations struck the sector. The drop followed comments by Federal Reserve Chair Jerome Powell, who stated that, “A rate cut in December is far from a foregone conclusion.”

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According to CoinGlass, total liquidations in the cryptocurrency market surpassed $800 million within 24 hours. Long positions accounted for $662 million of these losses, while short positions made up $166 million. Bitcoin was responsible for $370 million in liquidations, with Ethereum close behind at $189 million.

The price of Bitcoin dipped 2.5% in the past day. The overall cryptocurrency market capitalization declined 2.1%, standing at approximately $3.8 trillion. The broader crypto market, excluding Bitcoin, edged down just 0.24%. Analyst firm Glassnode noted in a post that U.S. spot Bitcoin ETFs experienced net outflows of $93 million, signaling elevated selling from institutional investors.

Among major tokens, XRP led losses, falling 3.5%. Ethereum dropped 2.3%, and Dogecoin slipped 2.4%. Retail investor sentiment shifted to ‘bullish’ for Ethereum, stayed ‘bullish’ for XRP, and remained ‘bearish’ for Dogecoin. Cardano and Solana both lost about 2%. Binance Coin was the only large-cap crypto in positive territory, gaining 0.9%.

In related market movements, shares of Strategy (the largest corporate Bitcoin holder) fell 0.08% in pre-market trades. Bitmine Immersion Technologies (BMNR), a digital asset treasury firm, declined 0.62%. Meanwhile, crypto exchange Coinbase (COIN) saw shares rise 0.78%.

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At the latest meeting, the Federal Open Market Committee voted 10-to-2 for a 25 basis point rate cut. Some committee members favored larger reductions or holding rates steady, highlighting ongoing disagreement over the future trajectory of U.S. monetary policy.

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