[Bitcoin Now] $100,000 Mark Broken... Triple Blow and 'Tech Stock Shock'

Diminished Expectations for U.S. Rate Cuts
Anxiety Following Large-Scale Liquidations in October
"Hacking Incidents" Further Undermine Market Trust

The price of Bitcoin has fallen below $100,000 for the first time in five months since June. The cryptocurrency market, already weakened by diminished expectations for a U.S. interest rate cut, large-scale liquidations, and hacking incidents, was dealt a final blow by the poor performance of major U.S. technology stocks such as Palantir.

According to cryptocurrency market tracker CoinMarketCap on November 5, as of 10:00 a.m., Bitcoin was trading at $101,193, down 4.6% from 24 hours earlier. The price briefly dropped to as low as $98,962 in the early morning hours before barely recovering the $100,000 mark. Compared to its yearly high of $126,198 recorded on October 7, this represents a decline of nearly 20%.

At the same time, Ethereum, the leading altcoin (cryptocurrencies other than Bitcoin), fell by 10.7% over the past 24 hours, while other major cryptocurrencies by market capitalization such as Solana (-8.08%), Ripple (XRP) (-6.96%), BNB (-6.63%), and Dogecoin (-4.78%) also showed weak performance.

The immediate cause of the downturn in the cryptocurrency market is the poor performance of major U.S. IT technology stocks. On November 4 (local time), shares of artificial intelligence (AI) defense company Palantir plunged nearly 8% after its earnings announcement, amid concerns about overvaluation. In addition, David Solomon, CEO of Goldman Sachs, commented at an event in Hong Kong the previous day that a 10-20% stock market correction could occur within the next 12 to 24 months, which also negatively affected the market.

More fundamental causes include investor anxiety following large-scale liquidations immediately after the October Bitcoin rally, the U.S.-China trade war, diminished expectations for a policy rate cut by the U.S. Federal Reserve, and hacking incidents.

On October 10, Bitcoin buy positions worth $19 billion (about 27.5 trillion won) were liquidated. As a result, the price of Bitcoin slid from the $120,000 range to the low $110,000s. Business Insider described this as "the largest liquidation event in Bitcoin's history."

Weakened expectations for a U.S. policy rate cut are also exerting downward pressure. On October 29, Federal Reserve Chair Jerome Powell lowered the benchmark interest rate by 0.25 percentage points at the Federal Open Market Committee (FOMC) meeting, but drew a line against the possibility of another cut in December. The market had previously taken a December rate cut as a given.

Furthermore, a series of hacking incidents has shaken the foundation of trust in the cryptocurrency market. Just the previous day, the digital asset protocol 'Balancer' suffered a hacking attack, resulting in the theft of more than $128 million (about 190 billion won) in digital assets.

Derek Lim, Head of Research at cryptocurrency trading firm Kaladan, told Bloomberg, "The cryptocurrency market is currently being hit by a series of short-term negative factors," adding, "The market, already weakened by the large-scale liquidation event in October and successive hacking incidents, is now facing additional shocks."