Major Cryptocurrency Selloff Hits Digital Asset Markets
The cryptocurrency market experienced a sharp decline on Monday, reigniting selling pressure that had shown signs of stabilization in recent sessions. According to Bloomberg data, Bitcoin dropped as much as 4.3% to below $88,000 during early Asian trading hours, while Ethereum witnessed an even steeper fall of 6% to below $2,900.
Market Turmoil Continues After October Crash
This fresh wave of selling adds another chapter to the weeks-long crypto market downturn that began in early October. The initial trigger came when approximately $19 billion in leveraged positions were liquidated, occurring just days after Bitcoin had reached its unprecedented peak of $126,251. The market had shown some resilience last week with Bitcoin recovering above the $90,000 mark, but Monday's trading session erased those gains and pushed prices lower.
Traders across global markets are now preparing for potentially larger downward movements as December begins with significant risk aversion. The timing is particularly concerning given the crucial economic data expected from the United States that could influence Federal Reserve policy decisions.
Expert Analysis: Structural Headwinds and Key Support Levels
Sean McNulty, APAC derivatives trading lead at FalconX, characterized the situation as "a risk off start to December." He identified the primary concern as "the meagre inflows into Bitcoin exchange traded funds and absence of dip buyers."
McNulty further elaborated that structural challenges are likely to persist throughout the month, with market participants closely monitoring $80,000 as the next critical support level for Bitcoin. This psychological and technical barrier could determine whether the current correction deepens into a more severe bear market.
The week ahead promises crucial insights into US economic momentum as policymakers evaluate interest rate trajectories extending into 2026. Economic data releases are expected to shape market expectations regarding the Federal Reserve's rate-cutting cycle. Adding to the significance, US President Donald Trump announced on Sunday that he had selected his nominee for the next Fed chair, having previously emphasized his expectation for interest rate reductions.
Meanwhile, Asian equity markets showed mixed performance in early trading after completing their strongest weekly advance in approximately two months. S&P 500 futures indicated a slight downward trend, reflecting the cautious sentiment spreading across global financial markets.
