Bitcoin News Today: Government Shutdown Triggers $341M Crypto Liquidations as Liquidity Dries Up

The cryptocurrency market experienced a dramatic 24-hour liquidation event, with $341.85 million in losses recorded as Bitcoin (BTC) and Ethereum (ETH) traders faced forced closures of leveraged positions, according to a Yahoo Finance report. The total liquidations, driven by Bitcoin's range-bound trading between $104,700 and $107,100, saw long positions bear the brunt of the losses, with $41.75 million wiped out in BTC trades alone, as reported in a Coinotag article.

This volatility came amid broader market uncertainty, as the U.S. government shutdown, which ended by the Senate on Nov. 11, had previously drained liquidity and delayed regulatory decisions, exacerbating the deleveraging event that pushed Bitcoin down over 20% from its October peak, according to the Yahoo Finance report.

The liquidation spike was compounded by fragile investor sentiment. The Crypto Fear & Greed Index fell to 26, remaining in the "Fear" zone, while CoinGlass data showed a 6% drop in total liquidations to $339 million over the past 24 hours, as reported by the Yahoo Finance report. Open interest across crypto markets also declined 2% to $145 billion, reflecting cautious positioning. Analysts noted that the resolution of the government shutdown could trigger a relief rally by restoring liquidity and resuming regulatory processes, such as approvals for exchange-traded products, as the Yahoo Finance report indicated.

Institutional activity further shaped the market. JPMorgan Chase forecasted Bitcoin could reach $170,000 in six to twelve months, citing improved volatility metrics and a stabilized market post-deleveraging, as noted in a TradingView article. The bank also invested $102 million in Bitmine Immersion Technologies, gaining indirect exposure to over 3.24 million ETH, as reported in the TradingView article. Meanwhile, Charles Schwab announced plans to launch a spot Bitcoin ETF and enable direct crypto trading by mid-2026, signaling growing institutional acceptance, according to a CoinEdition piece.

Retail and institutional traders alike faced challenges. Crypto ETPs (exchange-traded products) saw $1.17 billion in outflows last week, with Bitcoin ETPs leading the exodus at $932 million, as detailed in a Cointelegraph report. However, altcoins like Solana (SOL) and XRP bucked the trend, recording $118 million and $28 million in inflows, respectively, as noted in the Cointelegraph report. This divergence highlighted shifting risk appetites, as investors sought exposure to smaller-cap assets amid Bitcoin's consolidation.

Regulatory developments also influenced the landscape. Ripple expanded its institutional offerings, unveiling U.S. spot prime brokerage services for hedge funds and asset managers, as reported in a CryptoNinjas piece. The firm's RLUSD stablecoin, integrated into cross-margin frameworks, aims to enhance liquidity and utility for institutional workflows, according to the CryptoNinjas piece. Separately, Pakistan announced plans to launch a rupee-backed stablecoin and develop a CBDC to capitalize on a $25 billion crypto opportunity, emphasizing financial inclusion and reduced remittance costs, as reported in a LiveBitcoinNews report.

Looking ahead, market participants remain split. While some analysts predict Bitcoin could test the $110,000–$115,000 range as liquidity improves, as the Yahoo Finance report suggested, others caution against overoptimism. The Federal Reserve's upcoming interest rate decisions and geopolitical tensions could sway risk sentiment, with ETF inflows and Ethereum's Fusaka upgrade in December serving as key catalysts, according to a WRAI article.

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