Bitcoin dropped below $82,000 on Thursday as renewed concerns over artificial intelligence spending triggered a sell-off across Asian markets and cryptocurrencies. BTC fell as much as 2.9% to approximately $81,600, while the CoinDesk 80 index lost 3.5% and decentralized finance tokens led the broader decline.
Bitcoin (BTC) recorded its steepest drop in two weeks after mixed quarterly results from Tesla and Meta Platforms raised fresh questions about the returns from major AI investments. The uncertainty weighed on Asian equities and weakened sentiment across digital assets.
China’s stock market entered bear-market territory as the CSI 300 fell 2%, extending its decline from the June high to 20%. Hong Kong’s Hang Seng Index dropped more than 3%, South Korea’s Kospi slid 3.5%, and Japan’s Nikkei 225 lost 2.7%. U.S. equity futures also retreated, with Nasdaq 100 futures falling 1.32% and S&P 500 futures declining 0.66%.
Altcoins faced greater selling pressure than Bitcoin. The CoinDesk 80 (CD80) declined 3.2%, compared with a 2.5% loss for the CoinDesk 5 (CD5). Ether (ETH) dropped 2.6% to near $2,400, while the DeFi sector index (DFX) fell 5.6%.
The market pullback occurred even as U.S. spot Bitcoin ETFs attracted more than $1 billion in inflows over the first three trading days of the week, according to SoSoValue data. Solana’s Alpenglow upgrade also went live overnight, but SOL declined 2.4% to around $104. Traders were also preparing for the release of U.S. initial jobless claims data later in the day.
Crypto Derivatives Show Traders Cutting Positions
Crypto derivatives volume increased 19% to $226.6 billion, while open interest fell 2.46% to $141.8 billion. Liquidations climbed 52% to $431.1 million, suggesting that traders were mostly closing existing positions rather than committing fresh capital. Long and short liquidations were relatively balanced, indicating that neither side dominated the losses.
Bitcoin and Ether futures trading volumes rose 36% and 27%, respectively. Yet open interest declined roughly in line with prices, suggesting that much of the drop in its dollar value resulted from lower token prices rather than a major change in the number of outstanding contracts. Funding rates remained slightly positive, showing limited directional imbalance in the market.
Position reductions were more pronounced among several altcoins. Zcash (ZEC) open interest fell 6.99% as its price declined 2.34%. Near Protocol (NEAR) recorded an 8.83% drop in open interest, while Uniswap (UNI) saw a 10.17% decrease. Chainlink (LINK) and Sui (SUI) also showed evidence of traders unwinding exposure.
Commodity Derivatives See Increased Activity
Commodity-linked contracts attracted more positions as cryptocurrency open interest declined. Gold futures open interest increased 12% despite a drop in the underlying price. Tokenized gold Tether Gold (XAUT) and silver contracts also recorded increases of 10% and 6.8%, respectively.
Rising open interest during a price decline can indicate that traders are opening short positions, although some investors may instead be buying the dip. Crude oil futures open interest rose 6.29%, while funding turned negative at -0.0126%, suggesting that traders holding short positions were paying to maintain them.
Market-order data pointed to a shift from buying to selling. Buying activity had dominated across most tokens roughly 24 hours earlier, but selling orders became prevalent by Thursday morning, including in Bitcoin and Ether.
Monero Funding Signals Elevated Leverage
Monero (XMR) stood out from the wider market, with its funding rate reaching approximately 70% on an annualized basis. The elevated rate indicates that leveraged long traders were paying a substantial premium to maintain their positions, increasing the risk of liquidations if prices move against them.
Monero futures open interest surpassed $300 million during the week, approaching the record level reached in January, according to SoSoValue.
Meanwhile, Bitcoin’s BVIV and Ether’s EVIV implied-volatility measures remained close to their 2026 lows. This suggests that options traders were not pricing in unusually large price swings despite the latest market weakness.
On Deribit, Bitcoin calls with strike prices of $85,000 and $86,000 expiring on Oct. 30 were among the most actively traded options over the previous 24 hours. However, short-term options skews continued to favor puts, indicating that downside protection remained more expensive than upside exposure. Ether options showed a similar pattern, suggesting traders were pursuing potential rallies while retaining hedges.
DeFi Tokens Bear the Brunt of the Sell-Off
Privacy coins moved in opposite directions. Monero gained 4.9% to around $651, making it one of only five assets in the CoinDesk 100 (CD100) to rise since midnight UTC. Zcash fell 4.8% to approximately $1,252.
Monero has advanced roughly 19% over the past month, with its futures open interest exceeding $300 million this week.
DeFi assets recorded some of the market’s largest losses. Curve (CRV) dropped 8.2% to about $0.37, although it remained approximately 4% higher for the week. Ethena (ENA) declined 7.2%, extending its loss to around 25% from its late-September peak.
Uniswap (UNI) slid 5%, leaving it down about 20% in October despite reporting record fee revenue in September, according to Token Terminal.
Other tokens also weakened. Celestia (TIA) fell 3.7%, bringing its weekly decline to approximately 9% and trimming its monthly gain to around 31%. The token faces an unlock of 5.58 million TIA on Oct. 31. LayerZero (ZRO) lost 4.2%, while Worldcoin (WLD), the iris-scanning identity token, declined 7.3%.
The Sandbox (SAND) dropped 5.1%, and Starknet (STRK) fell 6.1%. SAND had previously rallied after South Korean exchanges Upbit, Bithumb and Coinone lifted trading cautions on the token. STRK had gained after its network said it was considering a transition toward quantum-resistant Layer 1 technology.
Pump.fun (PUMP), the Solana-based memecoin launchpad token, declined 6% and remained down approximately 19% for the month.
Overall, renewed uncertainty over AI spending and weakness in global equities pressured crypto markets, while derivatives data showed traders reducing exposure across several assets. Despite strong Bitcoin ETF inflows earlier in the week, the sharp decline in DeFi tokens highlighted continued fragility across the altcoin market.
