Bitcoin Plunges Below $82,000, Erasing $10,000 in 24 Hours as Market Braces for Potential Fed Shake-Up
Bitcoin (BTC) extended its steep decline late Thursday, briefly dipping below the $81,000 mark in a sell-off that has erased roughly $10,000 from its value over a single day. The cryptocurrency managed a slight recovery to trade around $82,000, but remains on shaky ground.
Data from CoinGlass reveals the sheer force of the downturn: more than $777 million in leveraged long positions were liquidated in just the past hour, with the 24-hour total soaring to $1.75 billion. The pain spread across the digital asset market, with major tokens like Ether (ETH), BNB, and XRP shedding between 7% and 9%.
Analysts are now watching key technical levels. A CoinDesk analysis indicated that a break below $85,000 could signal further weakness. Bitcoin is currently testing its November low just under $81,000; a decisive breach could see it target the next significant support zone near $75,000, a level last seen in April 2025 amid tariff-related market stress.
The timing of the sell-off is notable, as it follows heightened political uncertainty surrounding the leadership of the U.S. Federal Reserve. Reports surfaced late Thursday that former President Donald Trump plans to nominate Kevin Warsh, a former Fed governor, to replace Chair Jerome Powell. Trump criticized the central bank's rate policy earlier this week, and CNBC reported Warsh was seen at the White House on Thursday.
Prediction market Polymarket reflects the shifting odds, with Warsh's chances rocketing to 87% from 37% just hours ago. This potential appointment is viewed by many traders as a hawkish shift, overshadowing other speculated candidates like BlackRock's Rick Rieder, who was perceived as more dovish.
Market Voices React
Eleanor Vance, Portfolio Manager at Stratton Digital: "This is a classic technical correction meeting a macro catalyst. The market was overextended, and the mere rumor of a policy pivot at the Fed was enough to trigger a cascade. The $81,000 level is critical; holding it is essential for medium-term bullish sentiment."
Marcus Thorne, Independent Crypto Trader: "Absolute carnage. This is what happens when you build a house of cards on leverage. The Fed speculation is just the excuse. The real story is the $1.75 billion in liquidations—that's a forced deleveraging event, and it's not over yet. Calling for $70,000 isn't fearmongering; it's reading the tape."
Dr. Aris Goldman, Economics Professor at Carlton University: "While the crypto market is reacting sharply, the broader implication is about monetary policy predictability. A change in Fed leadership, especially to a known quantity like Warsh, introduces a new variable for all risk assets, not just cryptocurrencies. Markets detest uncertainty."
Chloe Ren, Retail Investor: "It's incredibly frustrating. Every time we get momentum, something like this happens. It feels like the traditional financial world just can't let crypto have a sustained win. I'm holding, but days like this test your conviction."