Bitcoin and gold pared early losses during Friday's Asian trading hours alongside a rebound in stocks, as the Japanese yen surrendered its early gains, though crude oil prices near $100 kept inflation risks in focus.

Bitcoin (BTC: $84,459.46), the largest cryptocurrency by market value, recovered to nearly $82,000 after hitting lows below $81,000 overnight, according to CoinDesk data. At the time of writing, the cryptocurrency was testing its 50 simple moving average, a widely followed gauge of near-term market momentum. Other major tokens, including Ether (ETH: $2,490.55), XRP, Solana (SOL) and Dogecoin (DOGE: $0.08295), saw similar moves.

$435 Million in Futures Liquidations

Crypto futures positions worth $435 million were liquidated over the past 24 hours, including $385 million in long positions, a sign that leverage in the market was skewed toward the bullish side. Liquidations occur when exchanges automatically close leveraged trades whose margin can no longer cover losses, and long-position wipeouts typically cluster during sharp price declines, a process that can amplify downside swings.

Gold and Stocks Rebound as Yen Whipsaws

Gold, a traditional haven asset, bounced back to $4,020 per ounce from an early low of $3,986, a level last seen on July 29. Major Asian equity indices, including Japan's Nikkei and South Korea's Kospi, also rebounded from session lows. Nasdaq futures rose 0.17% to 29,190, up from 29,022 earlier in the day.

The risk-off tone had strengthened in early Asian trading as the yen climbed to 156.07 per U.S. dollar, its highest level since Sept. 18. Hotter-than-expected Japanese inflation data reinforced expectations of further Bank of Japan rate hikes, boosting the currency alongside a haven bid driven by AI-related jitters. Yen moves often ripple through global markets because the currency has long been used to fund risk-on carry trades.

Those gains proved fleeting, however, with the yen quickly falling back toward 157 per U.S. dollar.

Oil Near $100 and Soft ETF Demand in Focus

Whether the risk reset lasts may also depend on oil. WTI futures traded near $100, even after U.S. President Donald Trump invoked a Cold War-era law aimed at boosting fuel production, a move that has yet to materially cool oil prices. A sustained rise in oil could fuel global inflation and weigh on risk assets.

A steep rally in bitcoin would also require consistent demand for U.S.-listed spot bitcoin exchange-traded funds (ETFs), which has so far been lacking. The funds, which began trading in early 2024 and hold bitcoin directly on behalf of investors, have become a primary channel through which traditional money gains exposure to the token, making their daily flow readings a closely watched barometer of demand. On Thursday, these funds recorded $381 million in outflows, according to preliminary data from SoValue.