Bitcoin continued its losses on Tuesday, falling below $105,000, as one of the biggest sell-offs in weeks swept through cryptocurrency markets and investors grew increasingly cautious about the U.S. Federal Reserve's interest rate outlook.
The world's largest cryptocurrency was trading down 2.4% at $104,956.8 by 9:02 AM Saudi time.
Bitcoin fell by about 4% in the previous session, reaching its lowest level since mid-October.
Bitcoin continues to fall after a wave of liquidations
Data from CoinGlass showed that more than $1.27 billion of leveraged cryptocurrency futures positions were wiped out in the past 24 hours, marking the largest wave of liquidation in weeks.
Most of the losses came from long positions, as traders who had bet on further price increases were forced to liquidate their positions amid a sudden drop in the price of Bitcoin.
The sharp decline came as risk appetite waned in global markets, as investors digested mixed signals from Federal Reserve officials about the course of monetary policy.
Federal Reserve Governor Lisa Cook said on Monday that inflation is moving in the right direction but not fast enough, while San Francisco Fed President Mary Daly warned that the central bank should not commit to further interest rate cuts until there is clearer evidence that price pressures are slowing.
The conflicting messages heightened uncertainty about whether the Federal Reserve would cut interest rates again in December, prompting traders to reduce their risk exposure.
The rise in the US dollar and Treasury bond yields has added further pressure on Bitcoin and other cryptocurrencies.
Bitcoin's decline extended to form a volatile start to November, after recording its first loss during October, a month historically known for its highs, since 2018.
