October 3: $84,680 Today: $64,108 Bitcoin dropped 24.2% in 46 days. And it "fell more than 4% on Friday to $68,500," reports Fortune, "wiping out gains built over the past three months and casting doubt on whether its bear market was ever really over." The asset also faces weaker investor appetite, according to crypto analytics provider CryptoQuant. The firm's demand indicator recorded its weakest reading since December 2023, while Bitcoin exchange-traded funds became net sellers again. The recent downturn has also extended to other parts of the crypto market. That includes Tether's USDT, the largest cryptocurrency pegged to the U.S. dollar, whose total value shrank by $7.7 billion over the past two months, according to CryptoQuant, a sign that less cash is available in crypto markets. This time around, inflation has been the main culprit. Tuesday's Consumer Price Index report showed prices rose 0.4% in October, more than economists expected. Even stripping out food and energy, inflation ran hotter than forecast. Traders now overwhelmingly expect the Federal Reserve to raise interest rates by a quarter percentage point in December, with some betting on an even bigger increase. "Because these are non-yielding assets, and we expect inflation to rise... people are chucking stuff like gold and Bitcoin to find... government bonds that are going up, providing you [with] income," Chris Beauchamp, chief market analyst at financial technology company IG Group, told Fortune... Heavy borrowing and spending on AI have created what 21Shares calls an "AI black hole," drawing money toward the sector and away from assets like Bitcoin and gold. But Bitcoin remains "joined at the hip" with tech stocks, according to Beauchamp. That leaves it in an awkward position: It faces competition for investment dollars when enthusiasm for AI runs high, yet can get dragged down when that enthusiasm fades. Fast Company points out Bitcoin "remains down more than 20% since the beginning of 2026." [Nvidia] has seen its shares lose more than 27% of their value over the past month. The tech sell-off seems to have dragged down the crypto markets, too, as the two sectors are, on some levels, intermingled... On top of that, outflows from Bitcoin funds may also be contributing to the slide. More than $1 billion in leveraged crypto positions were closed in recent days, which may have added to declining demand, affecting BTC prices.

Read more of this story at Slashdot.