Bitcoin falls back to $85,000 as the situation in Japan threatens the markets

BBitcoin-1.64% dropped sharply overnight, wiping out an entire week of gains in just a few hours. While the move can be partly explained by the monthly close confirming the loss of key levels ($107,000 and $98,000), its severity is mainly due to the liquidity crunch that has been weighing on the market since October 10. But that’s not all; behind this drop lies a major macro development tied to Japan and the unwinding of the “carry trade,” which could put additional pressure on U.S. monetary policy.