Bitcoin Tumbles to Three-Month Low as Liquidations Accelerate

(Bloomberg) -- Cryptocurrencies tumbled over the weekend, with Bitcoin slumping to a three-month low of just above $63,000 as leveraged long positions were liquidated.

The largest digital asset sank 5.7% in the US on Saturday and continued to drop in Asia on Sunday to as low as $63,311, down a further 1.7% and its weakest since Aug. 17. Second-biggest token Ether, which slumped 8% in the US session, fell to $1,731 on Sunday, its lowest since July 9.

“I think this is a technical move, as Bitcoin broke down through its 200-day moving average of about $73,000, which has caused a slew of liquidations and new shorts to develop,” said Rich Rosenblum, co-founder of crypto market maker GSR. 

Crypto has been pummeled in recent weeks by a confluence of factors including the expectation of higher interest rates, large outflows from US spot Bitcoin exchange-traded funds, an AI-fueled risk-off mood and continued fallout from the recent $6 billion Binance hack.

Bitcoin has slumped about 25% since Oct. 21. Its low for the year is $57,742, reached on July 1.

Large liquidation events — in which more than $500 million worth of Bitcoin positions are wiped over 24 hours — are becoming a recurring feature in the market, as sharp swings repeatedly flush leveraged traders out of their bets. 

On Friday, Bitcoin’s slide triggered the liquidation of roughly $1.3 billion in long crypto bets over 24 hours, with Bitcoin positions accounting for the majority of that sum, according to Coinglass data. 

In the 24 hours through 7 a.m. Sunday in Singapore, exchanges tracked by Coinglass recorded about $1.9 billion of crypto liquidations, including $684 million in Bitcoin and $466 million in Ether. Long positions accounted for the vast majority of the liquidations.

From Oct. 30 through Nov. 13, US-listed spot Bitcoin ETFs saw almost $3 billion in net outflows.

Rosenblum said Bitcoin may be nearing a technical floor.

“Bitcoin has seen support at levels at or just below here over the last year, and we are approaching the bottom of a long term trend-channel,” he said.

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