Bitcoin stayed under pressure on Friday, with losses deepening as the day progressed. By mid-day, the cryptocurrency was trading near $68,885 around 12:30 PM (PKT). However, the downward trend accelerated later in the afternoon, with prices slipping to around $66,446 by 4:02 PM (PKT).
This marked a sharp decline compared to earlier levels. On March 25, Bitcoin had been trading near $71,794 around a similar time, highlighting how quickly sentiment has shifted in just a couple of days.
Liquidations add to selling pressure
The drop triggered heavy liquidations in the derivatives market. Data suggests that more than $50 million worth of long positions were wiped out within an hour. Roughly 70 percent of those losses were linked directly to Bitcoin trades.
Long positions refer to bets that prices will rise. When the market moves against such bets, exchanges automatically close them if traders fail to meet margin requirements. This forced selling often adds further pressure to falling prices.
Signs of bearish sentiment in the market
Market indicators are also pointing towards caution. Funding rates, which show the cost of holding leveraged positions in perpetual futures, have turned negative. This means traders betting on price declines are now paying those expecting gains, a sign that short positions are gaining traction.
At the same time, data shows strong liquidity building below the $66,000 mark. Analysts say this could open the door to further downside if the level is breached in the short term.
Broader economic factors weigh on risk assets
The weakness in Bitcoin is not happening in isolation. Global financial conditions are also playing a role.
US Treasury yields have climbed close to 4.5 percent, their highest since July. Higher yields tend to reduce the appeal of riskier investments such as cryptocurrencies.
Volatility in the bond market has also increased, with the MOVE index rising by 18 percent over the past 24 hours. This reflects growing uncertainty among investors.
Meanwhile, oil prices have moved up by around 3 percent as tensions in the Middle East and disruptions in Ukraine continue to affect supply expectations. At the same time, the US dollar index is edging closer to 100, signalling a stronger dollar, which typically puts additional pressure on risk assets.
Impact across crypto-linked stocks
The weakness in Bitcoin also spilled over into crypto-related equities. Shares of companies such as Coinbase, Circle Internet and Strategy, one of the largest corporate holders of Bitcoin, were seen trading lower in pre-market activity.
At current rates, one Bitcoin is worth roughly Rs18.5 million in Pakistani currency, reflecting the scale of its recent decline when measured against local values.
Read next: Gold prices slip further in Pakistan amid global market pressure
