Bitcoin tumbled below $77,000 on Friday after a suspected security incident at Binance accelerated a broader sell-off, while hotter PCE inflation data and persistent rate concerns had already pressured risk assets.
On Thursday, US personal consumption expenditures inflation for September rose to 3.6% annually, up from 3.4% in August. Although the PCE print came in line with expectations, stock futures fell, the S&P 500 lost more than 0.5%, and gold and silver plunged. Bitcoin initially declined about 1.5% on the day, grinding lower within a descending channel and testing support near $79,500. Technical analysts noted the 50-day simple moving average was acting as overhead resistance, while a bull flag structure on the weekly chart kept an upside breakout toward $90,000 as a potential scenario.
The Binance disclosure transformed that technical pressure into a liquidation cascade. The exchange said it was investigating a potential security issue and that customer funds were safe, but industry partners moved to freeze associated assets. According to CoinGlass, $1.49 billion in crypto derivatives positions were liquidated within 24 hours, including $1.29 billion in bullish bets, affecting more than 243,000 traders. Bitcoin accounted for approximately $475 million of the forced closures, with bullish positions representing nearly 88%. “Market recovery hinges on Binance restoring confidence in exchange security and customer funds,” Zeus Research analyst Dominick John told The Block.
After the collapse, CryptoQuant research head Julio Moreno identified Bitcoin’s 365-day moving average near $77,406 as initial support, while analyst Ali Martinez pointed to the 200-day moving average near $73,000 as a deeper level, cautioning they are “not guaranteed bottoms.” A recovery above $80,000, with sustained demand toward $82,000, would be needed to show sellers are losing control. The sell-off occurred as the Federal Reserve held rates at 3.75% to 4% and left the door open to further tightening. Earlier US spot Bitcoin ETFs had attracted $137 million on Wednesday, extending a three-day inflow streak to about $424 million, but those inflows preceded the latest plunge. “Bitcoin’s near-term performance may depend more heavily on Treasury yields, dollar movements and broader risk sentiment,” Bitget analyst Lewis Huang told Cointelegraph before the Binance incident.
