Key Takeaways
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- Bitcoin trades below $107,000, down 4% on the week.
- $19 billion in leveraged positions wiped out in October’s liquidation event.
- Institutional demand for Bitcoin now below mining output for the first time since April.
- Altcoins continue to slide, with the MarketVector index down 60% YTD.
- Analysts call current conditions a “hangover phase” as traders await confirmation of a market bottom.
The cryptocurrency market continued its decline on Monday, with Bitcoin dropping 4.3% to $105,300 and altcoins posting steeper losses. The downturn follows a historic October liquidation that wiped out $19 billion in leveraged long positions, leaving traders wary of re-entering the market.
The sell-off highlights ongoing fragility across digital assets, with risk appetite fading even as broader equity markets recover. Bitcoin remains up roughly 14% year-to-date, but its underperformance versus stocks has sparked questions about crypto’s role as a high-beta risk asset in the current macro environment.
A MarketVector index tracking the bottom half of the 100 largest digital assets fell 8.8% on Monday, marking a third consecutive day of declines. The index is now down about 60% for the year, underscoring persistent weakness among mid- and small-cap tokens.
Altcoins such as Toncoin (TON)—linked to the Telegram-backed blockchain project—fell nearly 10% after its treasury firm, TON Strategy Inc., received a Nasdaq compliance warning. The company’s stock dropped another 4%, extending a 37% decline for the year. The broader correction suggests investors remain risk-averse and are avoiding speculative tokens while rebalancing toward safer assets.
According to Charles Edwards, founder of Capriole Investments, institutional demand for Bitcoin has fallen below the rate of new coin issuance for the first time in seven months—an indicator that large buyers are stepping back.
This shift signals a short-term cooling of interest among asset managers and hedge funds who had been accumulating Bitcoin earlier in the year. Analysts attribute the pullback to cautious sentiment, portfolio rebalancing, and ongoing regulatory uncertainty in major markets. Edwards said the imbalance between mining supply and institutional demand could delay any sustainable recovery.
Market observers described the post-liquidation environment as a hangover period, with investors waiting for signs of stabilization.
Jordi Alexander, CEO of Selini Capital, said the market needs to “show a convincing bottom before making a fresh attempt upward.”
Matthew Kimmell of CoinShares noted that dormant Bitcoin wallets are starting to move coins back into circulation, indicating profit-taking and adding selling pressure.
Jake Hanley of Teucrium ETFs added that Bitcoin and XRP have been trending lower since mid-summer, a sign that traders are gradually reducing exposure. Analysts agree that rebuilding capital and confidence after such a large-scale liquidation will take several months.
