On Thursday, Bitcoin's price fell below the $70,000 mark, putting pressure on global risk assets. This followed the announcement by the Federal Reserve (Fed) to maintain interest rates, while a sharp rise in energy prices further exacerbated market volatility.
As of the time of writing, Bitcoin (BTC) was trading close to $70,000, down 1.6% from midnight. Ethereum (ETH) also dropped 1.7%, trading at $2,160. This trend aligns with a broader market correction. Earlier, the Fed decided to keep the federal funds rate unchanged in the range of 3.50%-3.75% during its meeting on Wednesday, which boosted the dollar's value and triggered a risk-averse sentiment in both the stock and cryptocurrency markets.
The pressure in the energy market is particularly notable. Following attacks on key energy facilities in the Gulf region by Iran and previous strikes on its South Pars gas field by Israel, Brent crude oil prices surged to $114, while Oman crude reached $150. European natural gas futures also saw a significant increase, rising about 25% to over $78 per megawatt-hour. The Nasdaq 100 futures fell approximately 0.3%, further confirming the overall market weakness.
Severe Turmoil in Derivatives Market, Over $600 Million Liquidated
The overnight decline led to massive liquidations in the cryptocurrency derivatives market, with nearly $600 million in leveraged crypto futures positions forcibly closed in the past 24 hours. Among these, long positions suffered the most, indicating that bullish traders were caught off guard by this drop.
The open interest in futures contracts decreased by 5.6% to $106.9 billion. Ethereum's open interest also fell by 9%, alongside a 6% drop in its spot price, signaling that capital is flowing out of the Ethereum market. Currently, the negative funding rates for major tokens like Bitcoin, Ethereum, BNB, and SOL suggest that short positions are regaining favor in the market.
The market's fear sentiment indicator has also worsened. The Volmex BVIV index, which measures Bitcoin's 30-day implied volatility, rose over 5% to 58.36%, ending a downward trend from the previous week.
Liquidity Constraints Challenge Altcoins
In a liquidity-constrained environment, the altcoin market faces severe challenges. Earlier in October, the market experienced $19 billion in leveraged liquidations and is still in a recovery phase. Against this backdrop, Bittensor fell 8.8%, and Hyperliquid dropped 6.5%.
Despite this, a few tokens have managed to rise against the trend. NEO increased by 4.2%, while the re-staked token ETHFI rose 1.5% to $0.55, continuing its strong performance since early 2026. The CoinDesk 20 index fell about 1%, while the DeFi News Select index and CoinDesk Memecoin index dropped 1.4% and 2%, respectively.
Market Outlook
The current market remains influenced by multiple macro factors, including geopolitical tensions and uncertainties in monetary policy. Bitcoin's struggle below $70,000 indicates that, amid high energy costs and the Fed's decision to maintain interest rates, investors are reassessing their risk exposure, and the market may face further volatility, testing key support levels.