Bitcoin dips below $64,000 as stocks hit record highs
Quick Take
- Bitcoin dropped below $65,000, despite major stock indices hitting record highs fueled by rate-cut expectations.
- The bitcoin price correction over the past day led to the substantial liquidation of long positions on centralized exchanges.
The bitcoin price fell below the $64,000 mark during trading on Friday, despite major stock indices hitting record highs amid dovish rate cut expectations.
Bitcoin 
BTC
-1.63%
has tended to correlate with risk-on sentiment in equity markets. However, the recent downturn in bitcoin's price coincides with major indexes closing at record levels on Thursday for the second consecutive day. The Dow gained approximately 0.7%, while the S&P 500 and Nasdaq Composite added roughly 0.3% and 0.2%, respectively. Thursday marked the fourth consecutive winning session for all three indexes.
The macroeconomic sentiment has been buoyed by recent signals of rate cuts from the U.S. Federal Reserve, along with a surprise rate cut by Switzerland's central bank. On Thursday, the Swiss National Bank announced a surprise reduction in its key interest rate to 1.5%. This move follows a decrease in Swiss inflation to 1.2% in February. The announcement marked the first time one of the world’s major central banks had taken such action since they commenced their efforts to combat post-pandemic price surges.
The value of the largest cryptocurrency by market cap decreased by over 4% in the past 24 hours, trading at $63,990 at 8:46 a.m. ET.
Bitcoin has fallen by over 4% in the past 24 hours. Image: The Block.
Market volatility over the past day
The bitcoin price correction over the past day led to the substantial liquidation of long positions on centralized exchanges. This volatility resulted in the liquidation of more than $54 million in bitcoin positions, with the majority — over $40 million — being longs, according to CoinGlass data.
The second-largest crypto, ether, also experienced a 3.4% downturn over the past day — now at $3,417 at 8:46 a.m. ET. SOL, the native coin of the Solana network, was hit harder, sliding by over 8% in the same period, according to The Block’s Prices Page.
The overall crypto market experienced over $134 million in liquidated long positions in the last 24 hours, contributing to a total of $192 million in liquidations across various centralized exchanges, the data show. (Liquidations occur when a trader’s position is forcibly closed due to a lack of funds to cover losses. This happens when market movements are unfavorable to the trader’s position, leading to the depletion of their initial margin or collateral.)
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Declining bitcoin liquid supply
Bitcoin exchange reserves have fallen to a multi-week low, indicating an increase in investors removing their coins as part of a long-term holding strategy.
According to CryptoQuant data, in the past month, there has been an outflow of over 44,600 bitcoins, resulting in exchange reserves hitting a multi-week low of just over 2 million bitcoins.
The outflow of bitcoin from exchanges to cold storage has been a trend since the beginning of the year, possibly driven by the rise in the digital asset's price and spot bitcoin ETF inflows.
Bitcoin exchange reserves are falling. Image: CryptoQuant.
The GM 30 Index, representing a selection of the top 30 cryptocurrencies, has decreased by 3.98% to 141.78 in the past 24 hours.
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