Bitcoin Plunges Below $100K, $900M in Market Liquidations

Bitcoin, the world's leading cryptocurrency, experienced a significant drop below the $100,000 mark on Friday, triggering nearly $900 million in market liquidations. The decline, which occurred during Asian trading hours, was driven by a combination of factors, including widespread market turbulence and the growing popularity of DeepSeek, a Chinese artificial intelligence company.

The price of Bitcoin fell by more than 6% in the last 24 hours, reaching as low as $97,000 before recovering to $99,290 at the time of writing. This decline breaks the momentum that pushed Bitcoin to its all-time high of $109,000 ahead of US President Donald Trump's inauguration. Analysts suggest that this downturn signals the end of a Trump-induced rally that defined the late 2024 market.

Arthur Hayes, the co-founder of BitMEX, warned of further declines, suggesting that Bitcoin could briefly dip to between $70,000 and $75,000. However, he remains bullish for the long term, projecting that Bitcoin will hit $250,000 before the year ends. Hayes cited potential financial instability and renewed monetary easing as key catalysts for this bullish outlook.

Other major cryptocurrencies mirrored Bitcoin's trajectory, with Ethereum, BNB, Solana, XRP, Dogecoin, and Cardano each losing up to 9%. The ripple effect of the crypto market decline was also evident in US stock indices, with futures for the Nasdaq 100 falling over 2%.

The widespread crypto market volatility triggered a liquidation spree, with over $855 billion wiped out, impacting more than 313,000 traders. Long traders suffered the heaviest losses, accounting for $794 billion, while short traders lost approximately $59 million. Bitcoin traders faced the most significant losses, with liquidations totaling around $259 million, including $247.5 million from long positions. Ethereum traders followed, recording $110 million in liquidations, with $104.8 million from long positions. The largest single liquidation event occurred on HTX, involving a $98 million BTC-USDT long position.