According to Woofun AI, the cryptocurrency market came under notable downward pressure on October 29, as Bitcoin (BTC) slipped below the key psychological threshold of $80,000 to trade at $80,297.76, a daily decline of 1.19%.
This price move was not an isolated event, but a direct reflection of macro risk-aversion spilling over into digital assets.
Ethereum (ETH) and Solana (SOL) came under pressure in tandem, falling 1.84% to $2,313.94 and 3.26% to $98.97, respectively.
By the evening of that day, the broader market displayed clear defensive characteristics, with major crypto assets all mired in corrective territory, reflecting investors' sharp reaction to short-term market uncertainty.
The core drivers behind this pullback were the spillover effect from traditional financial markets and security anxieties within the industry itself.
On Thursday, technology stocks weakened broadly, and this negative sentiment quickly spread into the cryptocurrency space, triggering a chain reaction of selling.
On-chain data from Woofun AI shows that during this bout of volatility, total liquidations in the crypto futures market reached as high as $356 million, of which long positions (long-term) accounted for roughly $205 million in liquidations, indicating that leveraged bulls were hit hard by the price decline.
An even more critical variable was news of a potential security vulnerability in a wallet linked to the Binance exchange, which further amplified market panic.
Preliminary reports indicated that approximately $2 billion in assets had been transferred out of wallets associated with the exchange.
Although there is currently no conclusive evidence that these funds were stolen or confirmed as a security breach, this unverified news was enough to trigger defensive moves by traders, pushing Bitcoin's price further down during the intraday session and below the $79,000 mark.
Given that the facts of the matter remain unclear, subsequent developments will become a key factor in determining how quickly market sentiment can recover.
On the institutional capital side, the performance of spot crypto ETFs also reflected a cautious stance.
The iShares Bitcoin Trust ETF (IBIT.US) fell 0.93%, the Fidelity Wise Origin Bitcoin Fund (FBTC.US) dropped 0.89%, while the iShares Ethereum Trust ETF (ETHA.US) declined somewhat more, by 1.53%.
The net asset value retracements of these ETF products were highly consistent with the moves in the spot market, indicating that institutional investors did not step in to buy the dip at this point, but instead chose to follow the market trend and reduce risk exposure.
Looking at broader asset performance, among the top ten cryptocurrencies by market capitalization, most posted declines.
Ripple (XRP) fell 4.6%, Binance Coin (BNB) dropped 2.1%, and although Tron (TRX) edged up 0.6%, the overall market lacked a strong leading sector.
It is worth noting that Hyperliquid (HYPE) rose 15.2% against the trend, with a 7-day gain of 20.8%, and Figure Heloc (FIGR_HELOC) advanced 1.5%, showing that some niche assets ran independent rallies while mainstream assets corrected, though this did not change the overall weak tone of the market.
Stablecoins Tether (USDT) and USDC were basically flat, holding near $0.9990 and $0.9995, reflecting stable demand for liquidity in the market.
Current market volatility stems from a combination of multiple macro and micro factors.
Geopolitical instability, shifting interest rate expectations, and fluctuating corporate earnings performance together form a backdrop of high volatility in financial markets.
As a high-beta asset, cryptocurrency is particularly sensitive to such macro risks.
Growing risk-aversion and the leverage liquidation effect form a positive feedback loop, further intensifying short-term price swings.
Although the long-term outlook still depends on fundamental progress, in the short term the market may need time to digest the current negative factors and re-establish balance.
Investors need to pay close attention to the follow-up investigation results of the Binance wallet incident, as well as the actual performance of tech stock earnings, as these factors will determine whether the market continues to decline or stages a rebound.
Before uncertainty is resolved, sharp volatility may become the norm, and investors are advised to remain cautious and avoid excessive leverage.
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