"Digital gold" loses its luster! Bitcoin plunges again, losing its "safe haven" halo, with its market value evaporating by billions of dollars in a week.

Notice that after experiencing a week-long crash and losing billions of dollars in market value, Bitcoin has once again failed to live up to its promise as a safe haven asset. The native cryptocurrency of the blockchain era, dubbed the "digital gold" and a tool for hedging market volatility, continued its downward trend in early London trading on Friday. Its price dropped by 3% to below $105,000 at one point. The second largest token, Ethereum, fell below $3,800, a decrease of over 20% from its peak in August. Meanwhile, the BNB token associated with Binance plummeted by 11% on Friday. From October 10th to the 11th, due to technical glitches and price discrepancies faced by users, the world's largest cryptocurrency exchange, Binance, was considered by analysts to be a major driver behind the record-breaking liquidation wave. Following the crash, Binance has provided nearly $600 million in compensation to users and businesses. Bitcoin had just hit a historic high of $126,251 on October 6th. A few days later, escalating tensions in US-China trade relations led to over $19 billion in liquidations, resulting in a major sell-off of most mainstream tokens. Despite industry giants like Kraken, Circle, BitGo, and Ripple seeking deeper involvement in regulated financial sectors through trust licenses, payment channels, and credit card products, the market has so far struggled to achieve sustained recovery. BTC Markets analyst Rachel Lucas stated, "It is noteworthy that this crash coincides with major institutions seeking banking licenses." She added that the shift towards traditional financial infrastructure "signifies a strategic hedge against volatility and aims to establish legitimacy." The risks stemming from US-China trade tensions continue to trouble non-cryptocurrency risk assets. The collapse of First Brands Group and Tricolor Holdings has reignited concerns about hidden credit losses, while Zions Bancorporation, N.A. (ZION.US) and Western Alliance Bancorp (WAL.US) saw their market value drop by over $100 billion in fraud-related write-offs in a single day for Bank of America Corp. As risk appetite swept the market, investors withdrew a net of $593 million from US-listed Bitcoin and Ethereum exchange-traded funds on Thursday. The Bitcoin put/call option ratio on the Deribit cryptocurrency derivatives platform rose to 1.33 in the past 24 hours, indicating increased hedging activity for further price declines. While traditional safe-haven assets like gold and silver continue to reach new highs, Bitcoin has disappointed. As of the week ending October 12th, it had dropped by 6.3%, marking its worst performance since early March, and has yet to rebound. Most cryptocurrencies are similarly showing weak performance. Matthew Hougan, Chief Investment Officer at Bitwise, stated, "Most importantly, I see cryptocurrencies as the canary in the coal mine, indicating that the market is on edge due to emerging credit concerns."