The global cryptocurrency market extended its month-long downturn on Friday, with bitcoin dropping below $86,000 in Asian trading for the first time since April. The renewed sell-off, driven by fading retail interest, unwinding of leveraged bets and broader risk aversion, has pushed digital assets deeper into bear-market territory.
Bitcoin fell as much as 2.1 percent to an intraday low of $85,474 in Singapore, reflecting a sharp loss of momentum after October’s explosive rally. Analysts note that selling pressure from large holders has amplified the decline. A Chinese analyst said crypto “is suffering from heavy selling by whales”, with over $20 billion of bitcoin dumped since September.
In a sign of worsening sentiment, several of China’s most prominent cryptocurrency entrepreneurs have abandoned a planned $500 million ether digital asset treasury (DAT) initiative. The project had already secured $110 million in commitments. According to people familiar with the discussions, deteriorating market conditions forced the group to shelve the plan.
DAT companies are publicly traded firms that accumulate large holdings of cryptocurrencies to enhance valuations. While increasingly popular in the US – where Strategy, formerly MicroStrategy, holds nearly 650,000 bitcoin – the structure has not gained regulatory traction in Hong Kong. The decision to halt the ether DAT plan underscores how far the market remains from recovering after October’s violent rout, which erased roughly $19 billion in leveraged positions and liquidated more than a million traders.
Bitcoin, which touched repeated all-time highs earlier in the year, is now more than 30 percent below its peak. Leon Li, now chairman of Hong Kong-listed Sinohope Technology Holdings, recently told investors that “the market wasn’t doing very well” and that the macroeconomic outlook remained “unclear”. Meitu’s Cai said the group would revisit the ether DAT project only when conditions improve.
Meanwhile, global equity markets have also turned volatile. A short-lived rally driven by Nvidia’s earnings fizzled as concerns mounted over stretched AI valuations and uncertainty about whether the US Federal Reserve can deliver a December rate cut. These cross-currents have intensified caution across risk assets.
Options traders are now closely watching bitcoin’s $85,000 support, with demand rising for downside hedging at both $85,000 and $82,000 levels. “Crypto is no longer the canary in the coal mine – it’s the coal mine itself,” said Bloomberg strategist Brendan Fagan, warning that the sector remains vulnerable to even modest shocks in liquidity and sentiment.