Gold and Silver Plummet Amid Weak U.S. Housing Data, Pressuring Digital Asset Market

The New York digital asset market experienced a bearish turn on October 9 as early trading gains gave way to declines. A combination of disappointing U.S. housing data and a broad correction in safe-haven assets like gold and silver dampened risk appetite across the board. Leading the retreat were Binance Coin (BNB) and Ripple (XRP), with both cryptocurrencies shedding nearly 6%.

Precious Metals Decline Intensifies Downward Pressure

Safe-haven assets suffered substantial losses, further straining digital markets. Silver, which had briefly touched a record high of $50 per ounce, fell by over 4% to close at $48.55. Gold also retreated, dropping more than 1% to settle at $4,035. The corrections in these asset classes amplified investor caution and curtailed risk-on sentiment across equity and crypto markets.

Crypto Market Hit Hard; Altcoins Record Significant Losses

The cryptocurrency market struggled to maintain the previous session’s bullish momentum amid mounting headwinds. Bitcoin (BTC) fell 2.22% within 24 hours, trading at $120,965, according to CoinMarketCap. The sell-off coincided with a 2.3% drop in the PHLX Housing Sector Index (HGX), marking its fourth consecutive session of losses. Weak housing data, coupled with elevated interest rates, continued to weigh on investor sentiment.

Most of the top 10 cryptocurrencies by market cap faced sharp declines. Ethereum (ETH) slid 4.16% to $4,335, Binance Coin (BNB) lost 5.93% to $1,241, and Ripple (XRP) fell 3.90% to $2.79. Solana (SOL) ended its trading day down 4.46%, while Dogecoin (DOGE) and Cardano (ADA) recorded losses of 4.69% and 3.60%, respectively. Despite the broader downturn, Binance Coin maintained a notable 15.89% weekly gain, showcasing resilience amid the volatility.

By the afternoon session on October 9, total digital asset market capitalization declined 2.68% to $4.12 trillion compared to the previous day. Bitcoin’s market dominance climbed to 58.58%, suggesting a shift toward large-cap assets for stability, while Ethereum’s dominance fell slightly to 12.7%.

Derivatives Market Experiences Heightened Liquidations

The bearish sentiment extended to the derivatives market, where volatility prompted widespread liquidations. According to CoinGlass data, over $600 million worth of leveraged positions were liquidated in the last 24 hours, primarily affecting long positions. This wave of forced liquidations underscores the elevated risk environment after an initial attempt to rally in early trading.

CME futures markets mirrored this weakness, with Bitcoin October contracts slipping 1.91% to $121,695. November and December contracts saw even greater drops of 2.00% and 2.49%, respectively. Ethereum futures suffered similar declines as October contracts fell 4.17% to $4,350, in line with spot market performance.

Bitcoin ETFs Extend Inflows but Momentum Slows

Despite broader market corrections, Bitcoin ETFs maintained inflows for the eighth consecutive session—albeit at a slower pace. Farside Investors reported net inflows of $440.26 million into Bitcoin ETFs on October 8, a significant decrease compared to the $899.94 million observed the prior day. Ethereum ETFs also saw modest inflows totaling $14.89 million, pushing cumulative investments close to the $2 billion mark. Some individual products, however, recorded outflows during the same period.

Institutional Interest and Regulatory Progress Support Long-Term Outlook

While short-term volatility persists, institutional support and evolving regulatory frameworks continue to anchor the long-term outlook for digital assets. Luxembourg made headlines as the first Eurozone nation to directly invest in Bitcoin and related ETFs through its sovereign wealth fund. Meanwhile, in the U.S., the Securities and Exchange Commission (SEC) streamlined its review process for cryptocurrency ETFs, sparking optimism for additional approvals in the near future.

Investor sentiment remained neutral, with the Alternative Fear and Greed Index holding steady at a balanced score of 58. This metric reflects the market’s current state of equilibrium as participants weigh macroeconomic uncertainties against constructive institutional tailwinds.

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