Bitcoin Falls Below $100K as Market Liquidations Surge — Are We Entering a Correction Phase?

Bitcoin has plunged below the critical $100,000 level for the first time since June, sending shockwaves through the crypto market and reigniting debates about whether the long-awaited correction is finally here.

According to market trackers, BTC dropped 7.4% to around $96,794, as over $45 billion in leveraged positions were liquidated within 24 hours. Ethereum (ETH) and other major altcoins mirrored the drop, losing between 10–15% as traders rushed to de-risk.

The Sell-Off: What Really Happened Today

The immediate trigger appears to be a combination of macro headwinds and whale profit-taking. On-chain data from Glassnode shows large wallets offloading BTC at local highs — a sign of distribution rather than panic.

Meanwhile, U.S. bond yields continued climbing after the Federal Reserve hinted at delaying rate cuts, putting renewed pressure on risk assets. The domino effect spilled over into crypto futures, where highly leveraged positions were wiped out in rapid succession.

We’re se“eing the classic mid-cycle shakeout,” says Vijay Mehta, a crypto derivatives analyst. “Excess leverage and complacency tend to build up at psychological levels like $100K. When that breaks, it resets market structure.”

Why the Market Turned Risk-Off

Beyond technicals, sentiment has shifted decisively into risk-off territory.

• Fed Uncertainty: The U.S. central bank’s cautious stance on rate reductions strengthened the dollar, reducing appeal for speculative assets like crypto.

• Stablecoin Surge: Tether (USDT) and USDC dominance rose 1.8%, a typical signal that traders are moving to the sidelines.

• ETF Flow Slowdown: After months of steady inflows into Bitcoin ETFs, daily volume fell nearly 30% week-over-week.

Even in Asia, where enthusiasm has remained strong, Japanese exchanges reported slight dips in retail activity, suggesting global caution is setting in.

Forecast: Temporary Panic or the Start of a Deeper Slide?

This drop could either be a healthy cooling-off or the beginning of a multi-month correction. The deciding factor lies in whether Bitcoin can maintain support between $90K–$85K.

Historically, Bitcoin has experienced 15–25% pullbacks during bull cycles before recovering to new highs. But the macro backdrop — sticky inflation, strong dollar, and tepid tech sentiment — makes this correction more complex.

Analysts note that if BTC remains below $95K for several consecutive sessions, it may trigger further automated liquidations and a potential test of $82K.

Altcoins and DeFi: Collateral Damage

Altcoins have been hit harder than Bitcoin, with DeFi tokens like AAVE, UNI, and CRV sliding over 12%. Liquidity across decentralized exchanges (DEXs) fell by 9%, signaling lower trading depth and increased slippage risk.

Stablecoin yields, however, are climbing — a byproduct of risk repricing. This could attract cautious investors back into DeFi if volatility persists.

What Traders Should Watch Next

• Macro Policy Updates: Upcoming U.S. CPI data and Fed minutes will shape risk sentiment.

• On-Chain Whale Reentries: Monitoring accumulation at lower levels via wallet clustering tools.

• Altcoin Volume Shifts: Watch if capital rotates to stablecoins or high-cap assets like ETH and SOL.

• Futures Open Interest Reset: A dip below $80K could fully flush leveraged longs — typically the bottom signal.

The Bottom Line

Bitcoin’s break below $100K doesn’t spell the end of the bull narrative — but it does mark a transition point. The euphoric rally phase has paused, replaced by a test of conviction.

Long-term investors may view this as a structural reset, while short-term traders must brace for heightened volatility and cautious liquidity.

The market remains fundamentally healthier than in previous cycles, but the days of easy gains are clearly over — at least for now.

“Corrections aren’t signs of weakness,” as one analyst put it, “they’re the market’s way of asking who really believes.”

See all our insights: Bitcoin World News