Bitcoin News Today: "ETF Outflows and Liquidity Challenges Divide Crypto Market: Leading Coins Hold Steady as Altcoins Decline"
Cryptocurrency Market Sees Mixed Results Amid Volatility
On Friday, leading cryptocurrencies such as Bitcoin and Ethereum maintained their positions, while alternative coins including XRP and Dogecoin suffered losses. This divergence underscores the uneven performance currently seen across the digital asset landscape.
Market experts point to a generally bearish sentiment, fueled by significant outflows from exchange-traded funds (ETFs) and tightening liquidity. Bitcoin (BTC-USD) hovered around $87,080, representing a 30% decline from its October high above $126,000—the most substantial two-month drop since mid-2022. In comparison, major stock indices like the S&P 500 and Nasdaq experienced smaller declines of 2.5% and 4%, respectively, during the same timeframe.
November saw a sharp increase in Bitcoin ETF redemptions, totaling $3.5 billion—the largest monthly withdrawal since February. Notably, funds such as iShares Bitcoin Trust (IBIT) and Grayscale's GBTC endured consecutive days of losses. Analysts estimate that for Bitcoin to regain upward momentum, the market would need approximately $1 billion in new weekly inflows, a figure that currently falls short of actual demand. Additionally, institutional investors have slowed their accumulation since October’s peak, following a leveraged liquidation event on October 10 that wiped out $19 billion in open interest within a single day. This event established a new resistance zone between $98,000 and $102,000.
Liquidity across the crypto sector has deteriorated further, with the total value of stablecoins dropping by $4.6 billion since the start of November. Last week alone, $800 million exited the crypto space in favor of fiat currencies, indicating a reduced appetite for on-chain risk. Trading activity on centralized exchanges has also diminished, with daily volumes falling below $25 billion—a 40% decrease from early October—making Bitcoin more susceptible to price swings.
Industry Shifts and Strategic Moves
Despite these headwinds, some companies are seeking new avenues for growth. Bitfarms, a major Bitcoin mining firm, reported a 122% increase in adjusted EBITDA for the quarter, reaching $20 million. However, its gross mining margin declined to 35%, down from 44% the previous year. The company now plans to fully transition to artificial intelligence (AI) high-performance computing (HPC), aiming to capitalize on rising demand for computational power. While this strategy could streamline operations, it also introduces risks if AI demand slows or if capital investments do not yield expected returns.
Ethereum and Altcoins: Diverging Paths
Overall, the market remains cautious. Ethereum (ETH-USD) is trading near $3,400, largely shielded from Bitcoin’s recent sharp declines. Analysts attribute Ethereum’s resilience to its central role in decentralized finance (DeFi) and anticipated network upgrades, which may attract renewed institutional interest. In contrast, smaller cryptocurrencies like XRP and Dogecoin have continued to lose ground, as investors gravitate toward assets perceived as safer during periods of economic uncertainty.
