Bitcoin Hits 21-Month Low Below $58,000 as $1 Billion in Positions Liquidated

Bitcoin deepened its slide on Thursday, dropping to an intraday low of $58,131 — its weakest since September 2024 — before paring losses to around $59,460, according to Forbes data. The decline pushed the cryptocurrency more than 50% below its all-time high of roughly $126,000 set in October, erasing about $2.2 trillion from the global crypto market.

The selloff accelerated as macroeconomic headwinds and capital rotation into artificial intelligence stocks drained buying demand. The Personal Consumption Expenditures price index — the Federal Reserve’s preferred inflation gauge — rose to a three-year high of 4.1% in May, up from 3.8% in April, according to Benzinga and Nasdaq reports. That stoked fears the Fed could raise rates, with the CME FedWatch tool showing traders pricing a 48% chance of a rate increase at the September meeting.

The U.S. Dollar Index climbed to a 13-month high, a headwind for Bitcoin given its historically inverse correlation with the dollar, Prateek Gupta, head of business at Mudrex, told Livemint.

Over $1 billion in crypto positions were liquidated in the 24 hours ending Thursday. Coinglass data cited by TASS and Benzinga showed 148,895 traders were liquidated for $1.08 billion, with Bitcoin alone accounting for $488.95 million. Long positions bore the brunt at $842 million in liquidations. The largest single liquidation order was for a $38.05 million BTC-USD position on the Hyperliquid exchange.

The forced closing of leveraged bets added to selling pressure. Bitcoin’s open interest rose 0.38% over the last 24 hours even as the spot price fell, a sign that fresh short positions were entering the market, according to Benzinga.

Institutional demand weakened sharply. Spot Bitcoin ETFs recorded net outflows of $469.08 million on Wednesday, according to SoSoValue data reported by Benzinga. The iShares Bitcoin Trust ETF saw $239.30 million in net outflows and the Fidelity Wise Origin Bitcoin Fund shed $120.80 million on Wednesday, according to Nasdaq. The iShares Ethereum Trust ETF saw $86.10 million in outflows.

Further volatility looms as roughly $10 billion in Bitcoin options are set to expire Friday on Deribit, the world’s largest crypto options venue, according to Forbes citing Bloomberg. The expiration could drive sharp price swings as investors close or roll over positions.

Traders and analysts offered diverging outlooks. Some see further downside. Jiang Zhuoer, a Chinese Bitcoin miner and founder of LeBit mining pool, predicted Bitcoin could trade in the $42,000–$44,000 range between October and December, according to a CoinDesk report cited by Livemint. The same report noted that put options in the iShares Bitcoin Trust ETF traded at more than double the volume of call options on Thursday, with a 48% probability implied that the ETF could fall another 10% by the end of next month.

Other voices pointed to historical precedent. Bitcoin has registered a 50% decline from a prior high three times in the past decade, excluding the current drawdown, Nasdaq reported. From November 2021 to November 2022, the cryptocurrency dropped 76% before rallying 284% over the subsequent 43 months. Bitcoin has never posted two straight years of losses, according to the same source.

Capital rotation into AI investments is a key factor. “Capital has been flowing back into select AI and technology stocks, while ETF inflows into Bitcoin have slowed,” Nischal Shetty, founder of WazirX, told Livemint. Robert Mitchnick, BlackRock’s head of digital assets, said “the AI momentum is certainly suckling a lot of the oxygen out of the room,” according to Forbes.

Billionaire Philippe Laffont, founder of Coatue Management, told CNBC he was “a little bit more worried” about Bitcoin, saying he would “rather bet” on AI-backed businesses or SpaceX stock quadrupling over the next 20 years.

Ethereum fell 5.66% to $1,551.06, according to Binance data cited by TASS, and briefly hit an intraday low of $1,531. Trader Ali Martinez highlighted a “crucial” support zone between $1,584 and $1,683, warning that losing it risks a deeper breakdown toward $1,237 or $1,089, according to Benzinga.

XRP dropped 10.8%, Solana fell 6.5%, and Dogecoin lost 12.6% over the past week, Forbes reported. The global crypto market capitalization stood at $2.09 trillion, with Bitcoin accounting for roughly 58% of the total.

The S&P 500 edged up 0.4% and the Dow Jones Industrial Average rose 700 points, while the Nasdaq Composite slipped 0.3%, as tech stocks showed mixed performance.