Digital-asset markets have briefly rebounded to pare losses on Monday, but most major tokens have now resumed their descent
[MUMBAI] Cryptocurrencies continued to lose ground after a historic round of liquidations that triggered a sharp sell-off over the weekend, as trade tensions weighed on risk assets.
Bitcoin, the largest digital asset, fell as much as 5 per cent to just below US$110,000 on Tuesday (Oct 14) in New York, while Ether dropped 9.3 per cent to below US$3,900. Smaller, more volatile tokens also slipped, dragging the combined market value of all cryptocurrencies down by more than US$150 billion over a 24-hour period, according to CoinGecko data.
The slide came as China imposed curbs on the American units of Hanwha Ocean, one of South Korea’s biggest shipbuilders, hitting back against US measures against the Chinese shipping sector.
Earlier, about US$19 billion of leveraged crypto positions were liquidated in a brutal sell-off that began on Oct 10, after US President Donald Trump threatened China with harsher tariffs in response to new export controls.
Digital-asset markets briefly rebounded to pare losses on Monday, but most major tokens have now resumed their descent. The renewed US-China tensions have also weighed on equities, with US, European and Asian markets in the red on Tuesday.
The weekend sell-off represented a drastic reset for crypto. Investors pulled US$756 million from US Bitcoin and Ether exchange-traded funds on Monday, underscoring the sense of nervousness among traders.
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A move below US$110,000 for Bitcoin will prompt “a test of the US$104,000-$108,000 liquidity band”, according to Timothy Misir, head of research at digital-assets analytics platform BRN.
“The market now enters a consolidation phase, one defined by renewed caution, selective risk-taking, and a more measured rebuilding of confidence across both spot and derivatives markets,” analytics firm Glassnode said in a note.
The crypto gyrations have weighed on the expanding crop of publicly traded companies that have pivoted to hoarding digital tokens. Japan’s Metaplanet on Tuesday saw its enterprise value sink below that of its Bitcoin reserves for the first time as the stock tumbled 12 per cent to a five-month low in Tokyo. BLOOMBERG
