[Bitcoin Now] Plunges 7%, Drops Below $84,000 Intraday... $1.5 Trillion in Crypto Forced Liquidations

Bitcoin Down 7%, Ethereum Drops Over 9%
Risk-Off Sentiment Intensifies as BOJ Rate Hike Looms

On December 1 (local time), Bitcoin and other cryptocurrencies plummeted, triggering another wave of large-scale liquidations. As the prices of major cryptocurrencies, including Bitcoin and Ethereum, fell sharply, it was reported that leveraged positions totaling approximately $1 billion (about 1.47 trillion won) were forcibly liquidated, further intensifying downward pressure.

According to CoinMarketCap, a global cryptocurrency market data site, as of 2:30 p.m. Eastern Time, Bitcoin was trading at $84,805.79, down 7.14% from the previous trading day. After falling below the $90,000 mark for the first time since April this year last month, Bitcoin has continued to show a sluggish trend. During the session, it even dropped to the $83,000 range at one point.

Around the same time, Ethereum was trading at $2,740.7, down 9.59% from the previous day. The cumulative decline for Bitcoin and Ethereum this year has exceeded 9% and 10%, respectively.

Smaller and mid-sized cryptocurrencies, which are more volatile, have experienced even larger declines. The MarketVector Index, which tracks the bottom half of the top 100 digital assets, has plunged about 70% so far this year.

This latest downturn in cryptocurrencies is an extension of the bear market that began in early October. Bitcoin hit an all-time high of $126,251 in early November, but turned bearish after U.S. President Donald Trump threatened an additional 100% tariff on China. In this process, on November 10, $19 billion worth of cryptocurrencies were forcibly liquidated at once, and according to Bloomberg and other foreign media, another $1 billion was forcibly liquidated on this day. Forced liquidation occurs when an investor makes a leveraged investment with only a certain amount of collateral, and the exchange forcibly sells the assets if the price drops below a certain level. This can trigger a chain reaction of sell-offs, accelerating price declines and increasing market volatility.

Sean McNulty, APAC Derivatives Trading Lead at FalconX, said, "The start of December is clearly marked by a strong risk-off sentiment," adding, "There has been almost no capital inflow into Bitcoin exchange-traded funds (ETFs), and no signs of bargain hunting, so structural headwinds are likely to continue this month." He cited $80,000 as the next support level for Bitcoin.

The cryptocurrency market is also being affected by changes in the global financial environment. After Kazuo Ueda, Governor of the Bank of Japan (BOJ), hinted at a possible rate hike this month, concerns have arisen in the market about the unwinding of the yen carry trade, where investors borrow low-interest yen to invest in high-yield overseas assets. This is acting as a burden on risk assets such as cryptocurrencies and stocks.

Karim Dandach, OTC trader at Flowdesk, commented, "As we enter December, investors are paying closer attention to the path of global monetary policy," adding, "While the U.S. Federal Reserve is expected to cut rates, the BOJ is increasingly likely to raise rates."