Bitcoin Falls Below $82K as AI Fears Resurface and DeFi Tokens Sink

Bitcoin dropped below $82,000 on Thursday as declining Nasdaq futures and renewed concerns about artificial intelligence spending triggered a broader market sell-off. BTC fell as much as 2.9% to approximately $81,600, while the CoinDesk 80 index declined 3.5% and decentralized finance tokens suffered even steeper losses.

Bitcoin (BTC) recorded its sharpest decline in two weeks after mixed earnings reports from Tesla and Meta Platforms reignited investor concerns over the cost and potential returns of AI investment. The renewed uncertainty weighed on Asian equities and pressured cryptocurrency prices.

Chinese stocks entered bear-market territory, while Hong Kong’s Hang Seng Index fell more than 3%. South Korea’s Kospi dropped 3.5%, and Japan’s Nikkei 225 declined 2.7%. U.S. futures also weakened, with Nasdaq 100 futures losing 1.32% and S&P 500 futures slipping 0.66%.

Altcoins underperformed Bitcoin during the downturn. The CoinDesk 80 (CD80) recently fell 3.2%, compared with a 2.5% decline in the CoinDesk 5 (CD5). Ether (ETH) dropped 2.6% to around $2,400, while the decentralized finance sector index (DFX) plunged 5.6%.

Despite the market weakness, U.S. spot Bitcoin exchange-traded funds recorded more than $1 billion in inflows during the first three trading days of the week, according to SoSoValue data. Solana’s Alpenglow upgrade also went live overnight, but SOL fell 2.4% to approximately $104. U.S. initial jobless claims are scheduled for release later Thursday.

Crypto Derivatives Activity Increases as Traders Reduce Exposure

Trading activity in crypto derivatives climbed 19% to $226.6 billion, while open interest declined 2.46% to $141.8 billion. Liquidations surged 52% to $431.1 million, indicating that traders were largely closing existing positions rather than establishing substantial new ones. Long and short liquidations were relatively balanced, suggesting that neither side bore the losses exclusively.

Bitcoin and Ether futures saw trading volumes rise 36% and 27%, respectively. However, open interest declined roughly in line with prices, suggesting that much of the reduction in dollar-denominated open interest reflected falling asset values rather than a major shift in outstanding contracts. Funding rates remained slightly positive, indicating no significant imbalance between leveraged bullish and bearish positions.

Several altcoins experienced more pronounced position reductions. Open interest in Zcash (ZEC) fell 6.99% as its price declined 2.34%. Near Protocol (NEAR) open interest dropped 8.83%, while Uniswap (UNI) recorded a 10.17% decrease. Chainlink (LINK) and Sui (SUI) also showed signs of traders closing positions faster than prices were falling.

Commodity Derivatives Attract More Positions

While crypto derivatives activity weakened in terms of open interest, commodity-linked contracts attracted additional positioning. Gold futures open interest increased 12% despite a decline in price, suggesting that traders were adding exposure during the pullback. Tokenized gold Tether Gold (XAUT) and silver contracts also recorded open-interest increases of 10% and 6.8%, respectively.

Rising open interest alongside falling prices can indicate that traders are opening short positions, although it can also reflect buyers adding positions during a dip. Crude oil futures open interest climbed 6.29%, while funding turned negative at -0.0126%, suggesting that short-position holders were paying to maintain their exposure.

Order-flow data also showed a reversal in market sentiment. Around 24 hours earlier, market orders were predominantly buying across most tokens. By Thursday morning, selling orders had taken control across major cryptocurrencies, including BTC and ETH.

Monero Stands Out as Leverage Builds

Monero (XMR) was a notable exception in the funding-rate data. Its funding rate reached an annualized level of approximately 70%, substantially higher than those of other tokens. This suggests that leveraged long traders were paying a significant premium to maintain positions, creating the possibility of forced liquidations if the price reverses.

The elevated funding rate follows a buildup in Monero futures activity flagged earlier in the week. Bitcoin and Ether implied-volatility indicators, meanwhile, remained close to their respective 2026 lows, suggesting options traders were not anticipating unusually large price swings.

On Deribit, the $85,000 and $86,000 Bitcoin call options expiring Oct. 30 were among the most actively traded contracts over the previous 24 hours. However, short-term options skews continued to favor puts, indicating that downside protection remained more expensive than comparable upside exposure. Ether options showed a similar pattern, suggesting traders were positioning for a possible rebound while retaining hedges against further declines.

Privacy Coins and DeFi Tokens Diverge

Privacy-focused cryptocurrencies delivered mixed results. Monero rose 4.9% to around $651, making it one of only five assets in the CoinDesk 100 (CD100) to post gains since midnight UTC. Zcash, by contrast, fell 4.8% to approximately $1,252.

Monero has gained roughly 19% over the past month, while its futures open interest exceeded $300 million this week, approaching the record levels seen in January, according to SoSoValue data.

DeFi tokens were among Thursday’s weakest performers. Curve (CRV) dropped 8.2% to around $0.37, although it remained up approximately 4% over the week. Ethena (ENA) declined 7.2%, extending its monthly loss to around 25% from its late-September peak.

Uniswap (UNI) fell 5%, leaving it down approximately 20% for October despite generating record fee revenue in September, according to Token Terminal.

Other altcoins also retreated. Celestia (TIA) lost 3.7%, bringing its weekly decline to roughly 9% and reducing its monthly gain to around 31%. The token faces an unlock of 5.58 million TIA on Oct. 31. LayerZero (ZRO) fell 4.2%, while Worldcoin (WLD), the iris-scanning identity token, declined 7.3%.

The Sandbox (SAND) and Starknet (STRK) dropped 5.1% and 6.1%, respectively. SAND had rallied after South Korean exchanges Upbit, Bithumb and Coinone lifted trading cautions on the token. STRK had advanced following reports that its network was considering a transition toward quantum-resistant Layer 1 technology.

Pump.fun (PUMP), the token associated with Solana’s memecoin launchpad, fell 6% and remained down approximately 19% for the month.

Overall, the latest sell-off reflected renewed concerns about AI investment, weakness in global equities and a reduction in leveraged crypto positions. While Bitcoin ETF inflows remained strong earlier in the week, heavy losses across DeFi and several altcoins highlighted the market’s uneven performance.

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