- Bitcoin falls to $100,000, dragging the market down with over $610 million in liquidated positions in a single session
- Due to the recent shutdown, the US government has confirmed that the important October employment and inflation data will not be released
- The missing data leaves markets and the Federal Reserve without their regular reference points just as the Fed is evaluating policy ahead of year-end
A “data blackout” in the US has thrown crypto markets into a “risk-off” spiral, sparking a $610 million liquidation cascade that dragged Bitcoin down to the $100,000 support level.
The crisis began after the US government confirmed that the important October employment and inflation data would not be released due to the recent shutdown. The gap leaves markets and the Federal Reserve without their regular reference points just as the Fed is evaluating policy ahead of year-end.
Related: ‘Good News Is Bad News’: Why the Shutdown’s End Is Hurting Bitcoin
When key data goes missing
When there is a lack of key economic news, assets that normally react to that news become unstable. Trading becomes more about emotion than facts, the pool of active buyers and sellers shrinks, and a large number of automatic sell orders can quickly lead to a wave of forced liquidations.
With no October CPI or jobs prints, derivative markets have started pricing in a much lower probability of a December rate cut, taking away a major source of optimism that had been supporting crypto prices throughout October.
For instance, Polymarket is giving about a 56% chance that the Fed will cut interest rates by 25 basis points, which is down notably from a 90% chance in late October.
Related: Crypto Market Sees $360M Liquidations in 4 Hours as ETH Price Tumbled Below $3,400
“Data Vacuum”: Why $524M in ETF Inflows Failed to Move Bitcoin’s Price
This uncertainty has created a trader’s nightmare. When key economic data is missing, trading becomes driven by emotion rather than fundamentals, liquidity thins, and automated sell-offs can cascade.
The crypto market, which had been trading on a narrative of institutional adoption, is now seeing that thesis fail. In a stark display of this disconnect, Spot Bitcoin ETFs recorded a massive $524 million in net inflows on Tuesday, yet the price failed to rally and continued to move sideways.
This mismatch suggests that large traders are likely pulling back and waiting for a clearer signal before making big moves.
Private Sector Data Shows Cracks as Fed “Flies Blind”
With the Fed “making decisions in the dark,” traders are scrambling to find alternative data. What they are finding is not encouraging.
While official government data is gone, private sector jobs data suggest underlying weakness. The ADP report showed a weak addition of only 42,000 private jobs in October. More alarmingly, the Challenger report showed that planned job cuts announced by US companies skyrocketed by 183% to over 153,000, signaling that businesses are cutting staff due to economic pressure.
Ultimately, with the Fed lacking key indicators and crypto markets remaining highly leveraged, any strengthening of the US dollar, shift toward risk aversion, or selling pressure in derivatives can cause prices to swing wildly.
Until we get clear economic reports again, the market is likely set up for sudden and severe drops.
Related: US Shutdown Ends: XRP, Chainlink ETFs Back on Track as Crypto Regulation Resumes
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