Bitcoin falls below $122,000 after record high
Bitcoin dropped below $122,000 on October 7, 2025, reversing gains from a recent all-time high above $126,000 amid signs of an overheated crypto rally. Altcoins like Ethereum, Solana, XRP, and Cardano saw steeper declines of 3% to 7%, while the total market capitalization fell by about 2% to 4%. Analysts attributed the pullback to high inflows and a mixed U.S. Treasury auction result.
The cryptocurrency market experienced a sharp reversal on October 7, 2025, following Bitcoin's surge to record highs above $126,000 earlier in the week. Bitcoin traded around $121,950, down 2.4% to 2.65% over the past 24 hours, erasing gains from the previous three days. This pullback came after a 16% rise from late September lows below $109,000, with Bitcoin's year-to-date gain standing at 31% despite frequent sell-offs after peaks, such as a drop from $109,000 to $75,000 earlier in the year and a 10% decline after surpassing $123,000 in July.
Altcoins bore the brunt of the downturn. Ethereum fell 3.8% to $4,510, breaking its upward trendline and testing support near $4,300. Solana dropped 3.7% to $223.82, failing to break $237 resistance and forming a lower high from its late-September peak of $253. XRP declined around 3.8% to $2.87, remaining range-bound between $2.70 and $3.20 while testing $2.80 support. Cardano slipped 4.5% to $0.8319, and Dogecoin shed 5.4% to $0.2517. In contrast, BNB bucked the trend, rising 6.9% to $1,307.61 after hitting a new all-time high of $1,350, nearly doubling since July.
The total crypto market capitalization, which had risen by about $100 billion recently, fell 2.3% to 4% on the day, reaching $4.28 trillion and shedding roughly $170 billion. Analysts pointed to overheating signals, including the past week's record Bitcoin accumulation of 63,083 BTC—worth about $7.7 billion—across U.S. ETFs, CME futures, and perpetuals, surpassing May's peak. Vetle Lunde, head of research at K33, noted, "Historically, similar bursts in exposure have often coincided with local tops, and the current setup suggests a temporarily overheated market with elevated risk of short-term consolidation."
A mixed 42-day U.S. Treasury bill auction at 13:00 ET, with a stop-out yield of 4% above the 3.97% median, tightened financial conditions and triggered risk-off sentiment across equities and crypto. Jean-David Péquignot, CCO of Deribit, suggested Bitcoin could revisit $118,000-$120,000, offering a buying opportunity before climbing above $130,000 later in the year. Crypto-related stocks also declined, with MicroStrategy down 7%, Coinbase 4%, and miners like MARA Holdings 4% and Riot Platforms 3%.
The rally had begun around October 1 amid a U.S. government shutdown, adding about $12,000 to Bitcoin's price before the peak. While sentiment remains cautiously optimistic without clear capitulation, the pullback highlights crypto's sensitivity to traditional finance signals like Treasury yields.