Bitcoin drops below $90K amid ETF outflows and liquidations

Bitcoin (CRYPTO:BTC) has fallen below $90,000 for the first time since November 2024, reaching a low of $87,629 on February 25.

The decline is attributed to ongoing sell-offs in U.S. spot Bitcoin exchange-traded funds (ETFs) and broader market liquidations.

The recent downturn has been influenced by macroeconomic conditions, including elevated interest rates and reduced global purchasing power.

These factors have led to a decline in open interest and spot inflows, exposing Bitcoin to broader economic pressures.

U.S. Bitcoin ETFs experienced over $516 million in net outflows on February 24, marking six consecutive days of selling.

Since February 18, Bitcoin's price has fallen by over 6.2%.

In the two weeks leading up to February 21, ETFs recorded over $1.14 billion in cumulative net outflows, the highest two-week withdrawal period since trading began on January 11, 2024.

Ongoing trade tensions between the U.S. and China have also contributed to the ETF sell-off.

Internal market events, including the $1.4 billion Bybit hack on February 21, have further dampened investor sentiment.

Market volatility has led to $1.3 billion in total crypto liquidations over the past 24 hours, affecting 362,000 traders.

Bitcoin alone accounted for $523 million in liquidations.

On February 25, Bitcoin traded at $89,700 after rebounding slightly from its lowest point since November 18.

Despite the downturn, analysts suggest that similar corrections have been part of past crypto market cycles.

Raoul Pal noted that the current correction resembles the 2017 market structure, during which Bitcoin saw five 28% pullbacks, each lasting two to three months.

At the time of reporting, the Bitcoin (BTC) price was $88,376.69.