Bitcoin Slides to 102 Million Won as U.S. Policy Uncertainty and Strong Jobs Data Weigh on Sentiment

Bitcoin prices dropped to a range of 102 million won, or about $74,961, signaling widespread selling pressure on the cryptocurrency market. The decline is attributed to policy uncertainty following the U.S. midterm elections and robust employment data. As of 8:10 a.m. on November 9, Bitcoin was trading at 102.59 million won on Bithumb, marking a 1.10% decrease from the previous day.

Similar downward trends were observed in global markets, with Bitcoin trading at around $75,164 and other major altcoins like Ethereum, XRP, and Solana also witnessing declines.

The Republican Party's loss in the U.S. midterm elections is seen as a contributing factor, as their historical support for the cryptocurrency sector has weakened. Anticipation of regulatory easing has diminished, while concerns over interest rates have resurfaced following the release of stronger-than-expected U.S. employment data for October.

The Nonfarm Payrolls figure rose by 165,000, surpassing the predicted 65,000, and the unemployment rate dipped to 4.1% from 4.2%. These data points suggest that the Federal Reserve may sustain a restrictive monetary policy for an extended period. Consequently, the probability of a 0.25-percentage-point rate hike at the December meeting surged from 66.9% to 76.8% according to the CME FedWatch Tool.

The Crypto Fear and Greed Index currently stands at 28, indicating a fear-driven market sentiment. Additionally, substantial liquidations in the derivatives market have fueled the sell-off, with over $1.27 billion in cryptocurrency derivatives positions liquidated within a 24-hour period around November 5 and 6, including more than $1.1 billion in long positions betting on higher prices.

Heightened concerns over potential restrictions on AI data center construction may further hinder Bitcoin mining companies' expansion plans, adding to market uncertainty. Analysts warn that Bitcoin could experience additional downward pressure, potentially falling to $69,000 if it fails to maintain support near $75,500.

Despite the negative developments, some analysts believe Bitcoin has demonstrated greater resilience than in previous downturns. They point to the market's limited price reaction to the Binance security breach on October 29, which affected approximately $6.34 billion in digital assets. However, from an asset-allocation standpoint, some view Bitcoin as gaining relative strength against gold, with the amount of gold purchasable with one Bitcoin increasing from 12 to 21 ounces.

This development, although not necessarily signifying a shift in investor allocation, underscores Bitcoin's relative strength compared to gold. Since 2024, inflows into U.S. spot Bitcoin ETFs have amounted to around $55 billion.