Bitcoin Drops Below $108,000 Amid Crypto Market Turmoil

NEW YORK, NY — Bitcoin’s price fell to below $108,000 on Friday as investor sentiment turned cautious in the wake of U.S.-China trade tensions and a partial government shutdown. The digital currency, which had recorded gains earlier this month, is facing renewed selling pressure.

This downturn follows an alarming sequence of events in the prior week, where Bitcoin plummeted nearly 10% within hours after President Donald Trump announced a 100% tariff on Chinese goods, provoking a widespread market sell-off. Bitcoin was trading as high as $117,000 before crashing to lows around $104,000–$108,000, prompting a liquidation of over $19 billion in leveraged positions.

Market analysts noted that the latest decline has erased gains made after last week’s liquidation shock. “The lack of new catalysts is stalling crypto momentum,” a strategist commented, emphasizing how easily sentiment can shift in the crypto sector.

During the initial sell-off, altcoins experienced even steeper losses: Ether and XRP dropped by 15% to 30%. The total market capitalization of cryptocurrencies diminished by approximately $400 billion within a day, illustrating the deep-seated influence of macroeconomic news on the crypto market.

Bitcoin’s recent decline is also a sharp contrast to earlier October optimism. The cryptocurrency reached an all-time high of about $126,000 on October 5, driven by significant ETF inflows and safe-haven buying as economic fears increased with the government shutdown beginning on October 1.

“Altcoins are under pressure as liquidity continues to rotate back into Bitcoin and stablecoins,” Wenny C., COO at SynFutures, stated. She noted a trend where traders are opting for safer investments amidst rising risk aversion.

The current market dynamics have seen Bitcoin’s dominance rise, accounting for roughly 56% of the total crypto market cap. This trend mirrors past instances where Bitcoin’s strength has overshadowed weaker altcoins, none of which are spared from the ongoing sell-off.

Despite the decline, long-term holders continue to accumulate Bitcoin, with around 70% of its supply still profitable. “Nothing structural has really changed for Bitcoin’s investment thesis,” Wenny C. added, suggesting that the downturn is more a healthy market correction than a signal of long-term issues.

Market observers are now vigilant about upcoming macroeconomic factors, especially as the U.S. Federal Reserve prepares for its next policy meeting, anticipated on November 1. Changes in monetary policy could significantly impact market sentiment, prompting traders to watch closely for any signs of rate cuts or shifts in the Fed’s approach to inflation.

As Bitcoin trades in the mid-$100K range, crucial support levels are being tested. Analysts suggest that a drop below $105,000 could signal deeper corrections, while a rebound above $120,000 might turn the narrative positive again. The next few weeks are critical in determining if this volatility is a setback or the beginning of a more extended market pause.