The rout pushed Bitcoin from near $29,000 to as low as $25,314 in a 24-hour span before the biggest token recovered slightly in early European trading on Friday. More than $1 billion of positions were unwound in the sell-off, according to Coinglass data.
Bitcoin remains 60% above where it started the year, handily beating other well-performing assets like technology stocks. But a multitude of headwinds-from rising bond yields to regulatory pressures and economic weakness in China-threaten to undermine the appeal of assets like cryptocurrencies.
Crypto traders are now focusing on the $25,000 level for Bitcoin, below which options positioning suggests another cascade of liquidations could hit.
"With limited catalysts to push Bitcoin higher in the short term, a fall below $25,000 could put bears in charge, and if the rout in global risk assets continues, Bitcoin could face further downside," said Josh Gilbert, market analyst at trading and investing firm eToro..
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