- The price of Bitcoin dropped almost $2,000 early today, within a matter of minutes.
- The crash resulted in the liquidation of over $89 million BTC positions.
Zooming out to the weekly charts, the largest cryptocurrency, Bitcoin (BTC), clearly seems to be in a downtrend. Since reaching an all-time high (ATH) of $67,000 last week, the price of Bitcoin has been gradually declining. BTC has lost about 11% since the ATH, which somewhat suggests many people have been taking profits.
Going by on-chain data, this is also the case with long-term holders (LTH). According to Glassnode, a few LTHs are starting to cut in profits from the recent rally.
Bitcoin shades $2,000 within minutes
Earlier today, BTC shaded almost $2,000 from the $60,000 level to $58,017 within a matter of minutes. There isn’t any definite reason behind the sudden decline in BTC. However, it’s worth pointing out that the liquidations in the derivative market could also be a factor.
The cascade of sellings in the BTC market was strong enough to trigger the liquidation of $9.55 million worth of BTC long positions in one hour and $89.4 million within the last four hours, according to data from Bybt. On the 24 hours count, the market sees a much more loss of $182.3 million at the time of writing.
Just before this flush in the derivative market, funding rates in perpetual swap futures markets were seen at high levels following the increase in BTC. This shows many futures traders were excited and greedy at the same time amid the rally and the news around the ETF developments in the United States. When funding rates are high, it means traders have entered a state of euphoria, which usually results in steep corrections.
What’s next for Bitcoin?
BTC may have lost almost $10,000 since the October ATH. However, this can possibly be a mere correction. Many experts and analysts are positive that the bull market is still intact. On Tuesday, popular Bitcoin analysts and the S2F model creator, PlanB, said the second bull market has just begun. He predicts BTC will reach $100,000 in December.