Bitcoin fell below $70,000 on Friday, extending its recent decline as investor sentiment deteriorated amid institutional outflows, tightening liquidity and broader macroeconomic pressures.
Bitcoin (BTC) is trading at $68,607.23 at the time of writing, down 9.2% in the last week, according to CoinGecko.
The decline coincided with a sharp decline in market sentiment. The Crypto Fear & Greed Index fell to 20 on Friday, its lowest reading in more than four months, putting it in “extreme fear.” The index last reached that level on July 8.
Vikram Subburaj, CEO of crypto exchange Giottus, attributed Bitcoin’s weakness to institutional outflows, tightening crypto liquidity and expectations of a December Federal Reserve interest rate hike. “Investors should avoid chasing short-term dips or using excessive leverage,” he said.
In a Friday report, 10x Research highlighted Bitcoin’s divergence from US equities. Between Nov. 5 and Nov. 12, Bitcoin declined 5.9% while the Nasdaq 100 gained 6.4%, suggesting the cryptocurrency was responding more to rising Treasury yields and a stronger US dollar than to technology stocks.
The research firm said Bitcoin was increasingly trading alongside gold, which fell 5.5% over the same period, as the US 10-year Treasury yield climbed above 5%.
Meanwhile, institutional trading platform Talos also warned that thin liquidity and elevated leverage could amplify market volatility. Its weekly report showed Bitcoin order-book depth across major exchanges fell to $72 million on Nov. 9, roughly 33% below normal levels.
“Liquidity remains thin while leverage stays elevated, leaving the market vulnerable to sharp moves in either direction,” said Tanay Ved, senior research associate at Talos. “A rebuild in order-book depth and a turn in capital flows would provide a firmer foundation for recovery.”
The selloff follows sustained withdrawals from US spot Bitcoin exchange-traded funds (ETFs). BlackRock’s iShares Bitcoin Trust (IBIT) recorded more than $2 billion in net outflows across nine consecutive trading sessions through Wednesday, while broader funds shed nearly $1.44 billion over five sessions.
Preliminary Farside Investors data showed another $47.7 million in net outflows on Thursday, although figures for BlackRock and Fidelity were still pending.
Related: Bitcoin hovers near $74K as stocks rise despite US bond yield rebound
