Bitcoin slides below $83K as Wall Street pulls over $1B from crypto ETFs after Fed pause

Bitcoin BTC slid as low as $81,200 on Friday, deepening a market-wide pullback that has gathered pace since the Federal Reserve held interest rates steady earlier this week, while U.S. investors withdrew more than $1 billion from major crypto exchange-traded funds in a single day.

The slump marked bitcoin’s weakest level since November and came as spot bitcoin, ether ETH, solana SOL, and XRP XRP ETFs all recorded net outflows on Thursday, according to data from SoSoValue. The combined redemptions reflected a broader retreat from risk assets as markets reassessed positioning after the Federal Open Market Committee signaled patience on further easing.

Crypto markets had initially taken the Fed’s decision in stride, but selling pressure intensified alongside a wider downturn across equities and commodities.

Bitcoin is down roughly 3% on the day, while gold has shed nearly 7% in a sharp reversal that has erased an estimated $4 trillion from the metal’s market capitalization. Despite the pullback, gold has remained well ahead of bitcoin over the past year, with bullion up about 82% over that period versus a roughly 20% decline for BTC.

The selloff was amplified by forced liquidations, with more than $1.8 billion in leveraged positions cleared over the past 24 hours, largely from long traders, according to CoinGlass.

BTC has slightly recovered above $82,600 ahead of the U.S. market open, The Block’s price page shows. However, bitcoin is still on course for its fourth consecutive monthly loss, a streak that has persisted since last October, and one that would mark the longest such streak since 2018 during the post-ICO bear market, when it saw even longer declines. The broader market has also followed BTC’s lead, as major altcoins like ETH and SOL posted significant drawdowns.

Liquidity constraints

As market observers debated the root cause of BTC’s recent weakness, Thomas Perfumo, global economist at Kraken, said that liquidity has been the primary factor shaping price action.

Perfumo stated that crypto’s underperformance relative to precious metals has persisted even as rate cuts in 2025 have lowered nominal borrowing costs.

“Global liquidity, the factor with the greatest influence on crypto market performance, remains tight,” he said. “Interest rates are only one component of overall liquidity conditions. By contrast, gold has historically benefited from a weakening U.S. dollar and continues to absorb flows from more risk-sensitive investors.”

Perfumo added that bitcoin’s maturation as an institutional asset has dampened the volatility that once drew retail traders, though he said that dynamic is not permanent. Stabilization in long-term holder selling and progress on U.S. market-structure legislation could eventually prompt a reallocation back toward digital assets, he said.

Short-term positioning has also added to downside pressure. Matt Howells-Barby, vice president at Kraken and a professional trader, noted that concerns around heavy artificial intelligence spending by large technology firms have unsettled broader risk markets that entered the week heavily skewed toward risk-taking.

“With credit spreads already extremely tight, markets were firmly risk-on going into this move,” Howells-Barby said. “Bitcoin has felt the impact, with a wave of long liquidations pushing prices lower. A failure to reclaim the $83,500 area would leave the $80,000 region in focus.”

Miner pressure

Beyond macro forces, onchain data points to recent strain within bitcoin’s mining sector.

According to a CryptoQuant weekly report published Thursday, mining activity was materially disrupted by a severe U.S. winter storm that prompted several large operators to curtail production, accelerating the network’s largest hashrate drawdown since October 2021.

The firm asserted that Bitcoin’s hashrate fell roughly 12% from mid-November levels, while daily mining revenue dropped to a yearly low near $28 million as prices slid and block production slowed. Miner profitability deteriorated sharply during the period, though block times and hashrate have begun to recover as weather conditions eased, data from public network dashboards shows.

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