Bitcoin (BTC) rebounded sharply again on Tuesday, October 21st, losing all weekend momentum and falling nearly 3% to $107,552 in the early morning hours.
The asset moved in lockstep with the broader crypto market, with its total valuation dropping more than 2% to $3.67 trillion.
As expected, the new setback dampens expectations for an “Uptober” month known for its strong gains, with Bitcoin down 6.30% over the past month and trading at $108,290 at the time of publication.
Altcoins mirrored Bitcoin’s decline. For example, Ethereum (ETH) fell 5.3% to $3,859, XRP fell 2.2% to $2.41, and there was little reaction to Ripple Institute’s announcement of a new Treasury-backed vehicle called Evernorth.
At the same time, BNB fell by 5.7%, while Cardano (ADA) and Solana (SOL) fell by 4% to 6%. Among the meme coins, Dogecoin (DOGE) had the biggest loss, dropping 4.3%.
Why is Bitcoin falling?
As mentioned above, the global cryptocurrency market has fallen sharply over the past 24 hours, and as investor sentiment has reversed, Bitcoin has also fallen under strong selling pressure.
This decline was primarily fueled by the liquidation of $320 million in leveraged cryptocurrency positions in the past 24 hours.
Similarly, the US Spot Bitcoin ETF recorded further net outflows on October 20th, extending its withdrawal streak by four days as BlackRock recorded $101 million in redemptions.
Additionally, with a Fear & Greed Index of 33 (“Fear”), BTC appears oversold, but that could change ahead of the US Crypto Policy Roundtable scheduled for October 21-22.
Cryptocurrency leaked due to AWS outage
Yesterday’s Amazon Web Services (AWS) outage disrupted operations at major exchanges, including Coinbase, adding to the chaos.
As a result, access to digital assets was lost and liquidations were initiated by algorithmic systems, leading to further panic selling.
This amendment therefore highlights not only the dependence of cryptocurrencies on institutional adoption and macro factors, but also the vulnerability of cryptocurrencies to technological disruption.
Featured image via Shutterstock
