Sharp volatility across global markets has sparked a surge in bitcoin liquidations, with investors closing out roughly $2.56 billion worth of positions in recent days, according to data from CoinGlass. The sell-off came as cryptocurrencies moved in tandem with declines across other risk assets, including equities and precious metals.
Both bullish and bearish bitcoin bets were wiped out during the downturn. While the losses remain far below the record $19 billion in crypto liquidations seen after Donald Trump announced new tariffs on China, analysts say the latest episode highlights just how sensitive digital assets have become to shifts in broader market sentiment.
Despite bitcoin’s long-standing reputation for volatility, recent pressure has been driven by renewed concerns around artificial intelligence investments and a sharp pullback in metals markets. The latter was triggered after Trump said he would nominate Kevin Warsh as his pick for chair of the Federal Reserve.
“What we’ve seen over the last few months is investors stepping back to reassess their risk frameworks and how they operate in this market,” said Adam McCarthy, a senior research analyst at Kaiko.
Bitcoin had previously surged to fresh highs in early October, climbing above $126,000 before falling sharply. During the October 10–11 period, the cryptocurrency dropped as low as $104,782.88. It has not returned to those levels and was most recently trading around $78,396 after sliding more than 6% on Saturday.
Low trading volumes over the weekend intensified the downturn, according to analysts at Bitfinex, who noted that thin liquidity can amplify price moves during periods of stress.
At current levels, analysts warn that bitcoin remains highly vulnerable to external macroeconomic shocks. “The biggest risk to prices right now comes from outside forces — whether that’s a sharp increase in unemployment or a deterioration in the AI trade,” said Jim Ferraioli, director of crypto research and strategy at Charles Schwab’s Schwab Center for Financial Research.
Investor sentiment was further shaken last week by a wave of negative headlines, including disappointing earnings from Microsoft, which raised concerns about slowing momentum in artificial intelligence spending. Microsoft reported that revenue growth in its Azure cloud-computing division came in only slightly above expectations, sending the company’s shares down 10% the following day.
Markets are also bracing for potential policy shifts under Warsh, with investors anticipating interest rate cuts paired with a tighter balance-sheet approach — a combination that many see as relatively hawkish.
The nomination announcement also triggered a steep sell-off in precious metals. Gold suffered its largest single-day decline since 1983, while silver recorded its worst daily performance on record.
“Investors were looking for an excuse to reduce exposure, and they ended up getting several at once,” said David Morrison, senior market analyst at Trade Nation.
