The decline in cryptocurrency continues, with nearly $1 billion in leveraged positions being liquidated, and last week saw only a slight net inflow into spot Bitcoin ETFs

On Monday, cryptocurrency prices fell sharply again, triggering nearly $1 billion in leveraged positions to be liquidated in a new wave of accelerated declines, bringing fresh momentum to a widespread sell-off. Bitcoin dropped as much as 8% during New York trading hours to $83,824, marking a cumulative decline of nearly 30% since early October. Ethereum plummeted 10%, hitting a low of $2,719, down 36% over the past seven weeks. The market downturn has hit smaller, less liquid tokens harder—these tokens are favored by traders for their volatility and higher gains during bullish trends. The MarketVector index, which tracks the latter half of the top 100 digital assets, has fallen nearly 70% this year. The weakening of the cryptocurrency market began with a sell-off a few weeks ago. At that time, potential tariff increases by U.S. President Trump impacted the market, leading to the liquidation of approximately $19 billion in leveraged bets in early October, just days after Bitcoin reached its all-time high of $126,251. Such significant events of automatic liquidations in the crypto market (like on October 10) are often referred to as "liquidation waterfalls." Traders use liquidation data to assess leverage levels in the system, observe risk appetite, and determine whether a market clearing has genuinely eliminated excessive speculation. However, the data they rely on may not be complete. Industry insiders indicate that exchanges restrict the public availability of complete liquidation data, making it difficult for traders to understand the true scale of leverage in the system. Meanwhile, media reports indicate that the U.S. spot Bitcoin ETF recorded only about $70 million in net inflows last week, while approximately $4.6 billion has flowed out over the past month. The pressure mainly comes from the iShares Bitcoin Trust, where investors have withdrawn funds for five consecutive weeks, marking the longest streak of outflows since the fund's inception in January 2024. Industry insiders point out that December is starting with a risk-averse tone. The biggest issue is the weak inflows into Bitcoin ETFs and the lack of buying on dips. Structural headwinds are expected to persist this month. Attention is on Bitcoin's $80,000 as the next key support level. Digital currency assets are also feeling the spillover effects of global market macro turbulence. The Japanese stock market has declined, and the yen has strengthened, with Bank of Japan Governor Kazuo Ueda sending the clearest signal yet of a rate hike this month. The upcoming week will provide an important snapshot of U.S. economic momentum as policymakers weigh the interest rate path leading to 2026. The data may influence whether the market expects the Federal Reserve to continue its rate-cutting cycle. U.S. President Trump stated on Sunday that he has decided to nominate the next Federal Reserve Chair and has made it clear that he hopes his nominee will advocate for rate cuts