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- Bitcoin’s swift 6.5% drop in 20 minutes surprises the crypto market.
The leading cryptocurrency, Bitcoin, commenced the new week with a decrease of approximately 6.5% following a significant increase.
This 6.5% decline marks the largest single-day drop for Bitcoin in over a month, even though the asset has seen an overall rise of more than 12% in the past 30 days and an impressive 150% surge since January 1.
In an unexpected turn of events earlier today, Bitcoin (BTC) experienced a sudden 6.5% decline, falling below $41,000 and erasing nearly a week’s worth of gains.
This unforeseen downturn has left investors bewildered, triggering a ripple effect throughout the crypto market.
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Bitcoin Price Experiences Significant Drop
At 2:15 am UTC, Bitcoin’s price plummeted from $43,357 to a low of $40,659 within a span of 20 minutes. Simultaneously, Ethereum (ETH), the second-largest cryptocurrency by market capitalization, also experienced a sharp decline, dropping over 8.9%.
While both cryptocurrencies have since recovered slightly, with Bitcoin rising above $42K, it has again decreased to $41,898 at the time of reporting, while Ethereum is currently valued at $2,226, down over 5.01% for the day. This rapid market volatility has reverberated through other major cryptocurrencies such as Binance Coin (BNB), XRP, and Solana (SOL).
The sudden drop led to the liquidation of more than $270 million in long positions, as reported on the X platform.
#Bitcoin just closed its 8th green weekly candle in a row.
This week’s candle was a monster.
When correction, sir? pic.twitter.com/xxWjTxxLLr
— The Wolf Of All Streets (@scottmelker) December 11, 2023
Additionally, Bitcoin alone saw a loss of $1.2 billion in open interest, which now stands around $17.9 billion.
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Last week, optimistic projections indicated that Bitcoin might be on the verge of a rally, potentially reaching $50,000 in the upcoming weeks.
Alistar Milne, a notable analyst, described the current bear market as the “worst” Bitcoin has encountered under the 200-week Moving Average price. Milne anticipates a golden cross forming as the 50-week Moving Average intersects with the 200-week Moving Average, indicating a possible bull market.
CryptoCon, another analyst, drew comparisons between Bitcoin’s current cycle and the cycles of 2015/2018, having accurately predicted the peak in July and the bottom in August.
According to CryptoCon’s BitTime model, Bitcoin could reach $47,000 soon and may undergo a “long sideways period” in early 2024, potentially rising to $130,000 by December 2025.
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Potential Factors Influencing Bitcoin’s Uptrend
The recent increase in Bitcoin’s value has been primarily linked to the expectation that the United States Securities and Exchange Commission (SEC) will approve several spot Bitcoin Exchange-Traded Funds (ETFs).
This regulatory advancement is anticipated to provide large institutions with unprecedented access to cryptocurrency. The sentiment surrounding Bitcoin ETFs is crucial, given that industry leaders have been advocating for it for the past decade.
While Vanguard Group and State Street Corp have opted to remain on the sidelines, the involvement of firms like BlackRock Inc (NYSE: BLK) and Franklin Templeton is expected to eventually alter the landscape.
Moreover, market participants have been encouraged by widespread expectations that the United States Federal Reserve will initiate interest rate cuts in mid-2024.
The prospect of a more accommodating monetary policy has fueled investor optimism, with market participants preparing for the next round of inflation data and closely monitoring the final Federal Open Market Committee (FOMC) meeting of 2023.
Inflows into the Bitcoin Short fund, which is designed to profit from a decline in BTC, have also increased, with an inflow of $8.6 million noted.
The post Crypto Market Shaken As Bitcoin Starts The Week With A Decline appeared first on BitcoinWorld.
