Key PointsBitcoin plunged under $100,000 on Thursday during U.S. trading hours, extending a multi-week pattern of intraday weakness.Analysts warn the market may have already seen its 2025 peak as rate-cut expectations fade.A severe liquidity drought triggered by the U.S. government shutdown is hitting risk assets, but strategists expect a reversal soon.Crypto mining and infrastructure stocks suffered double-digit losses.Bitcoin fell sharply below $100,000 on Thursday, extending a pattern of heavy selling during U.S. market hours and dragging the broader crypto sector into deeper losses.After briefly rebounding to $104,000 overnight, Bitcoin reversed in early U.S. trading and slid under the key $100,000 level in the afternoon. The asset is now down 1.7% over the past 24 hours, marking one of the sharpest intraday rejections this month.The downturn came as global risk assets sold off. The Nasdaq dropped 2% and the S&P 500 fell 1.3%, with traders scaling back expectations for a Federal Reserve rate cut in December.Crypto Stocks Hit Hard as Liquidity Dries UpCrypto-linked equities faced another heavy blow, particularly miners tied to AI infrastructure and data centers.Bitdeer (BTDR): –19%Bitfarms (BITF): –13%Cipher Mining (CIFR) & IREN: –10%+Broader crypto equities — including Galaxy, Bullish, Gemini, and Robinhood — fell 7–8%.Analysts say the sector’s weakness is becoming increasingly correlated with macro conditions, especially liquidity trends.“Crypto is more linked to macroeconomics now than at any time in the past,” said Paul Howard, senior director at Wincent.Analyst: Bitcoin’s 2025 High Might Be InMarkets are now pricing in roughly 50/50 odds of a 25 bps cut in December, down significantly from earlier expectations.“With just six weeks left, we’ve likely seen the all-time highs for 2025,” Howard said. “From here, I expect a steady but muted rise through next year.”His view reflects a broader shift among traders: cooling rate-cut hopes are removing a key upward driver for Bitcoin.Government Shutdown Sparks Liquidity SqueezeThe recent U.S. government shutdown has triggered an acute liquidity crunch — the opposite of the usual deficit-fueled liquidity boost that tends to support markets.Market analyst Mel Mattison noted that the federal government posted a $198 billion surplus in September, and October may show an even larger surplus due to the shutdown.“We’ve had one of the driest liquidity periods in months, if not years,” Mattison said.But he expects conditions to flip quickly.“The floodgates are about to open. The administration is going to unleash a tsunami of fiscal largess in coming quarters — mid-terms must be defended.”Mattison said markets may remain choppy for another week or two, but expects risk assets, including Bitcoin, to rebound as liquidity returns.
Catherine
