Bitcoin Drop Below $100K Generates $206 Million in Liquidations

• Bitcoin drops to $97K; Ethereum, Solana and XRP also retreat.
• Cryptocurrency liquidations surpass $206 million in one hour.
• US economic data negatively impacts crypto market.

The cryptocurrency market faced a sharp correction on Tuesday, January 7, 2025, when Bitcoin (BTC) unexpectedly fell below $100 during early trading in the United States. Data from Coingecko shows that over $206 million worth of crypto positions were liquidated in just an hour, reflecting the impact of this fall on the market.

At the time of publication, the price of Bitcoin was quoted at US$97.512,62 with a drop of 4.4% in the last 24 hours.

Bitcoin hit a low of $97.207, down 4%, reducing the global cryptocurrency market cap by 4,5% to $3,44 trillion. Altcoins were also caught in the selloff. Ethereum (ETH) plunged 6,5% to $3.475, while Solana (SOL) fell 6% to $208. XRP also saw a significant drop of 4,8% to $2,32. Dogecoin (DOGE) followed suit, falling 7% on the day.

Total liquidation volume in the past 24 hours reached $388 million, with $206 million concentrated in a single hour. Most of the liquidations involved long positions, especially in Bitcoin and Ethereum. The largest single order was recorded on Binance, in the ETH/USDT pair, worth $11,9 million.

The selling pressure was amplified by macroeconomic data released in the United States. According to analyst Miles Deutscher, the increase in the ISM index and the Job Openings report (JOLTS) had a significant impact on risk markets. He commented that “positive economic data can be interpreted as negative for markets, due to reduced expectations of an interest rate cut by the Federal Reserve”.

The practice of “spoofing” has also been cited as a contributing factor to volatility. This method, which involves large-scale investors manipulating orders on the liquidity books, can create wild price swings. Keith Alan of Material Indicators noted that “spoofing, while annoying, often facilitates predictable movements in the price of Bitcoin.”

While some analysts believe in a potential recovery, others warn of a possible test of lower levels, such as $92, if selling pressure persists. Trader and analyst Rekt Capital highlighted that a daily close above $101.165 would be needed to indicate a solid recovery in the near term.

The decline also reflects a shift in market sentiment toward the Federal Reserve. Expectations of interest rate cuts, which had previously fueled optimism, have faded after the institution signaled caution. This uncertainty continues to impact both traditional and cryptocurrency markets, demonstrating the sensitivity of digital assets to global economic conditions.