Bitcoin’s price fell sharply Wednesday, dropping below $72,000 for the first time since November 2024 and fueling over $650 million in crypto market liquidations. Analysts cite macroeconomic uncertainty and leveraged trade unwinds, with some pointing to long-term holders reducing exposure as Bitcoin’s underperformance against gold questions its inflation-hedge narrative. Market participants see potential for further downside, with a test of $60,000 possible if the correction continues.
Bitcoin extended losses Wednesday evening as selling pressure resumed across derivatives markets. The digital asset briefly fell beneath the $72,000 mark, trading around $71,400 and down nearly 43% from its October all-time high of $126,080.
Total crypto liquidations over the last 24-hours jumped to above $654 million. Bitcoin accounted for 41% of that figure at $272 million according to CoinGlass data.
John Haar, managing director at Swan Bitcoin, called the drawdown a “common” trait for the asset. “Nothing has changed the long-term Bitcoin investment thesis,” Haar stated.
He attributed the sell-off to macroeconomic factors and the impact of leveraged traders being flushed out. Other analysts noted the pressure appears driven by long-term holders.
Georgii Verbitskii, founder of TYMIO, said Bitcoin’s inflation-hedge narrative is being questioned short-term as gold rises. “This doesn’t mean the long-term thesis is broken, but it does suggest that confidence in the inflation-hedge narrative has weakened for now,” he explained.
Verbitskii noted the downtrend leaves room for further downside. “If this corrective wave continues, a move toward the $60,000 area can’t be ruled out,” he said.
Ryan Yoon, senior analyst at Tiger Research, said Bitcoin is reacting negatively to both macro tailwinds and headwinds. However, he noted Bitcoin has entered oversold territory and its value will shine once liquidity flows back.
Vincent Liu, chief investment officer at Kronos Research, said breaking below $72,000 pushes the market into a patience-required phase. He said the sell-off could fade as leverage compresses and ETF outflows slow.
