Unexpectedly, the price of Bitcoin (BTC) fell below $60,000. This caused investors and experts to scramble to figure out what may have caused the move.
The first and biggest cryptocurrency, Bitcoin, had a brief drop below $60,000 for the first price in over a month as market volatility increased in front of the April 20 halving event.
The biggest cryptocurrency saw its losses taper somewhat on Wednesday after plunging to a low of $59,648. Since its all-time high of $73,750 on March 14, bitcoin has already dropped by about 15%.
According to recent market statistics, a wave of long position liquidations brought on by excessive leverage may be a major driver in the BTC price decrease. Leveraged holdings were compelled to liquidate when prices dropped, which set off a chain reaction of sell orders that further depressed the price of bitcoin.
According to Bloomberg’s speculation, a wave of liquidations in long bets on digital assets may have contributed to the recent decline in Bitcoin prices. Almost $780 million worth of optimistic cryptocurrency bets were cashed out in a day on Friday.
CoinGlass data shows that during the recent decline in Bitcoin, positions totaling $251 million were liquidated overall, with long bullish bets making up $173 million of this amount.
Selling pressure increased as a result of the massive number of long positions being liquidated, which caused the price to drop even further. This in turn prompted further liquidations, setting off a chain reaction that drove the price of Bitcoin below $60,000.
As of this writing, investors flocked to purchase the drop, and Bitcoin had somewhat rebounded, moving 0.85% higher in the previous day to over $62,700. According to cryptocurrency expert Ali, as the price of Bitcoin dropped, approximately 27,700 BTC, or around $1.72 billion, migrated into accumulation addresses, which have never spent money.
According to several market participants, the leverage on the cryptocurrency market has been cleared with the most recent sell-off, and the long-term view for Bitcoin is still mostly optimistic.
