Bitcoin slides below $70K amid thin liquidity, ETF outflows
Bitcoin fell below $70,000 on Friday, trading at $68,607.23, as investor sentiment deteriorated to "extreme fear" levels.
The cryptocurrency's decline coincided with the Crypto Fear & Greed Index falling to 20 on Friday, its lowest reading in over four months and putting the market in "extreme fear" territory. The index last reached this level on July 8.
Institutional Outflows
Vikram Subburaj, CEO of crypto exchange Giottus, attributed Bitcoin's weakness to institutional outflows, tightening crypto liquidity, and expectations of a December Federal Reserve interest rate hike.
Investors should avoid chasing short-term dips or using excessive leverage.
Market Divergence
According to 10x Research, Bitcoin diverged from US equities between Nov. 5 and Nov. 12, declining 5.9% while the Nasdaq 100 gained 6.4%. The research firm noted Bitcoin was increasingly trading alongside gold, which fell 5.5% as the US 10-year Treasury yield climbed above 5%.
Liquidity Concerns
Talos warned that thin liquidity and elevated leverage could amplify market volatility, with Bitcoin order-book depth across major exchanges falling to $72 million on Nov. 9, roughly 33% below normal levels.
Liquidity remains thin while leverage stays elevated, leaving the market vulnerable to sharp moves in either direction.
ETF Outflows
The selloff follows sustained withdrawals from US spot Bitcoin ETFs. BlackRock's iShares Bitcoin Trust recorded over $2 billion in net outflows across nine consecutive trading sessions through Wednesday, while broader funds shed nearly $1.44 billion over five sessions. Preliminary Farside data showed another $47.7 million in net outflows on Thursday.
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