BTC slips under $87K as hackers, tariffs, and ETF outflows collide to spark a sharp risk-off reversal.
Bitcoin slid below $86,500 on Sunday night, marking one of its steepest weekend drops in weeks as a mix of macroeconomic pressure, ETF outflows, and fresh DeFi exploits pushed traders into defensive mode.
Major altcoins suffered even heavier declines: ether fell over 5%, XRP dropped 6%, and Solana slid more than 6%. The broader market shed $144 billion in just four hours, erasing nearly all of bitcoin’s five-day recovery above $90,000.
A Fast Fall Back to November Lows
Bitcoin plunged from $91,300 to $87,000 in roughly three hours — levels last seen during November’s mid-month downturn. Traders had recently bet on a December rate cut from the U.S. Federal Reserve, with the CME FedWatch Tool showing an 87% probability of a 25 bps reduction. But those expectations no longer outweigh persistent inflation and tariff concerns that continue to cap risk appetite.
Monthly bitcoin ETF outflows of $3.5 billion in November and a wave of long-liquidations since mid-month have added to what many see as a broad deleveraging cycle.
Yearn Finance Hack Fuels Panic
Sunday’s decline intensified after Yearn Finance suffered a major exploit, with attackers draining its yETH pool and sending 1,000 ETH through Tornado Cash. The incident landed just days after Upbit’s security breach, heightening unease across DeFi and centralized exchanges alike.
Given Yearn’s role as a major mover of liquidity across Aave, Compound, and Curve, traders worry the hack could trigger additional unstaking, withdrawals, and further market stress.
Key Levels and Short-Term Paths
Market watchers flagged $87,000 as the near-term line to hold — a level that briefly stabilized overnight. Losing it, however, opens the door to $80,400, with the possibility of a liquidity sweep into the $75,000 region if selling accelerates.
On the upside, a confirmed December rate cut could historically support a 10%–15% rebound, potentially lifting BTC back toward $95,000–$100,000. A strongly dovish message from Fed leadership could extend momentum toward $110,000–$120,000.
Politics Add a New Catalyst
Adding another wrinkle, President Donald Trump announced Sunday that he has chosen the next Federal Reserve Chair, though the name remains undisclosed. Prior reporting suggested Kevin Hassett as a leading candidate. Markets may interpret the announcement as a sign of coming policy softness, especially if the new pick favors liquidity support.
Some crypto industry leaders expect this political shift to inject fresh optimism into rate-cut expectations over the coming weeks — potentially stabilizing BTC after its turbulent start to December.