Bitcoin Slides to $81,200 as $1B Exits U.S. Spot Crypto ETFs
What Drove Bitcoin’s Latest Drop?
Bitcoin fell as low as $81,200 on Friday, extending losses that gathered pace after the Federal Reserve held U.S. interest rates steady earlier in the week. The move marked bitcoin’s weakest level since November and capped a sharp shift in sentiment that spread across the broader crypto market.
The decline coincided with heavy withdrawals from U.S. spot crypto exchange-traded funds. More than $1 billion was pulled from bitcoin, ether, solana, and XRP products in a single session, according to data from SoSoValue. The synchronized outflows pointed to a broad reduction in risk exposure rather than asset-specific pressure.
Crypto markets initially absorbed the Fed’s decision without major disruption. Selling accelerated later as equities and commodities also moved lower, suggesting that investors were adjusting portfolios after the Federal Open Market Committee signaled patience on further easing.
Investor Takeaway
Why Liquidity Matters More Than Rates
While attention has focused on monetary policy, analysts point to liquidity conditions as the dominant force behind recent price action. Thomas Perfumo, global economist at Kraken, said crypto has continued to lag even as rate cuts in 2025 lowered nominal borrowing costs.
“Global liquidity, the factor with the greatest influence on crypto market performance, remains tight,” Perfumo said. “Interest rates are only one component of overall liquidity conditions. By contrast, gold has historically benefited from a weakening U.S. dollar and continues to absorb flows from more risk-sensitive investors.”
The contrast with gold has been stark. Although bullion dropped nearly 7% during the latest selloff, it remains far ahead of bitcoin on a one-year basis. Gold is up about 82% over that period, while bitcoin is down roughly 20%, underscoring how defensive flows have favored traditional hedges over digital assets.
Forced liquidations added to the pressure. More than $1.8 billion in leveraged crypto positions were wiped out over the past 24 hours, largely from long traders, according to CoinGlass. Such liquidations tend to amplify moves during periods of thin liquidity, accelerating declines once key levels break.
Positioning Risks and Technical Levels in Focus
Short-term market structure has also weighed on prices. Matt Howells-Barby, vice president at Kraken and a professional trader, said broader risk markets entered the week heavily tilted toward risk-taking, leaving them vulnerable to sharp reversals.
“With credit spreads already extremely tight, markets were firmly risk-on going into this move,” Howells-Barby said. “Bitcoin has felt the impact, with a wave of long liquidations pushing prices lower. A failure to reclaim the $83,500 area would leave the $80,000 region in focus.”
Bitcoin later edged back above $82,600 ahead of the U.S. market open, but remains on track for a fourth straight monthly decline. If confirmed, it would be the longest such run since 2018, during the post-ICO bear market. Major altcoins have followed the same pattern, with ether and solana posting comparable drawdowns.
Investor Takeaway
Miner Disruptions Add Another Layer of Pressure
Beyond macro and market positioning, onchain data points to strain within the bitcoin mining sector. A CryptoQuant weekly report said mining activity was disrupted by a severe U.S. winter storm that forced several large operators to curtail production.
The disruption triggered the largest network hashrate drawdown since October 2021. CryptoQuant estimated that hashrate fell about 12% from mid-November levels, while daily mining revenue dropped to a yearly low near $28 million as prices declined and block production slowed.
Miner profitability deteriorated during the period, adding potential sell-side pressure as operators managed cash flow. Network data shows block times and hashrate have begun to recover as weather conditions eased, but the episode highlighted how external shocks can still ripple through bitcoin’s supply side.
What to Watch Next
The near-term outlook hinges on whether liquidity conditions ease and whether ETF flows stabilize. Perfumo noted that bitcoin’s growing institutional footprint has reduced the extreme volatility that once defined the asset, though he cautioned that the current environment still leaves prices sensitive to shifts in macro liquidity.
Stabilization in long-term holder selling and progress on U.S. market-structure legislation could support a rotation back toward digital assets later in the year. Until then, bitcoin’s performance is likely to remain closely tied to broader risk appetite and the availability of global liquidity.
