Bitcoin Falls Below $70K as ETF Outflows, Thin Liquidity Weigh

Bitcoin fell below $70,000 Friday, extending its weekly decline as institutional outflows, reduced market liquidity and expectations of a Federal Reserve interest rate hike in December weighed on the cryptocurrency.

Bitcoin traded at $68,607.23, down 9.2% over the past week, according to CoinGecko. The Crypto Fear & Greed Index fell to 20, its lowest level in more than four months. The reading is classified as “extreme fear” and matched the level recorded July 8.

Giottus CEO Vikram Subburaj attributed the decline to institutional outflows, weaker liquidity in crypto markets and expectations of a December rate hike. He advised investors to avoid chasing short-term declines and using excessive leverage.

Bitcoin also diverged from U.S. stocks between Nov. 5 and Nov. 12. During that period, Bitcoin fell 5.9%, while the Nasdaq 100 gained 6.4%, according to 10x Research. The firm reported that Bitcoin was responding more closely to higher Treasury yields and a stronger U.S. dollar than to technology stocks.

Bitcoin also moved more in line with gold during the period, according to the research firm. Gold fell 5.5%, while the yield on the 10-year U.S. Treasury note rose above 5%.

Order-book depth, which measures the amount of buy and sell orders available near the market price, also declined. Talos reported that Bitcoin order-book depth across major exchanges fell to $72 million on Nov. 9, about 33% below normal levels.

“Liquidity remains thin while leverage stays elevated, leaving the market vulnerable to sharp moves in either direction,” said Tanay Ved, a senior research associate at Talos. “A rebuild in order-book depth and a turn in capital flows would provide a firmer foundation for recovery.”

U.S. spot Bitcoin exchange-traded funds have recorded sustained withdrawals. BlackRock’s iShares Bitcoin Trust posted more than $2 billion in net outflows across nine consecutive trading sessions through Wednesday. Investors withdrew nearly $1.44 billion from the broader group of funds over five sessions.

Preliminary data from Farside Investors showed an additional $47.7 million in net outflows Thursday. The figures for BlackRock and Fidelity were still pending.

Reviewed and fact-checked by Alex Panasenko on November 13.