Bitcoin Plunge Spurs Liquidations as SpaceX’s Token Sale Weighs

(Bloomberg) — Cryptocurrencies extended declines, sliding with global risk assets as investors price in higher interest rates for longer. A report of Elon Musk’s SpaceX selling Bitcoin holdings added to the concerns.

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Bitcoin fell 4.5% at 11:18 am Singapore on Friday, and was headed for its biggest weekly decline in three months, after touching a low of $25,314. The largest cryptocurrency started retreating from $28,947 a day earlier as global bond yields hit multi-year highs, reducing the appeal for alternative investments such as digital tokens.

The sudden fall after weeks of thin trading sparked massive liquidations across exchanges. More than $1 billion of positions were unwound in the past 24 hours as prices fell, according to Coinglass data. A Wall Street Journal report citing documents that SpaceX has sold off its Bitcoin holdings after writing down $373 million also weighed on sentiment.

“With limited catalysts to push Bitcoin higher in the short term, a fall below $25,000 could put bears in charge, and if the rout in global risk assets continues, Bitcoin could face further downside,” said Josh Gilbert, market analyst at trading and investing firm eToro.

It wasn’t clear from the WSJ report when SpaceX had sold its Bitcoin.

While broader markets are seeing a pullback in the selling as the dollar weakened, the selloff in digital tokens amid thin liquidity continued unabated on Friday. The top 100 digital tokens gauge fell more than 5%, outstripping a 0.2% decline in a regional stock index.

The next support level for Bitcoin is $25,000 and a breach may accelerate liquidations, according to analysts. Other smaller tokens also slipped — Ether was down 2.3%, Cardano and Solana 4.4% each.