Crypto bloodbath: Altcoins hemorrhaging as Bitcoin falls below $63,000

(Kitco News) – The cryptocurrency market correction intensified overnight as Bitcoin (BTC) supports submerged bullish support at $67,000 and sent the top crypto falling to a low of $62,460. Bulls remain on the ropes at the time of writing, with bears now looking to remove support at $62,000 en route to a BTC price below $60,000.

BTC/USD Chart by TradingView

Altcoins have been hit even harder, with many high flyers down 20-40% from their recent highs as crypto traders take profits en masse and wait for the dust of this correction to settle.

Data provided by Coinglass shows that long positions were the biggest losers in this pullback, as Bitcoin’s relentless rise over the past three weeks led many traders to believe it was only “up” for the foreseeable future, which is usually when major corrections take place. in the land of cryptocurrencies.

The broad pullback comes as Monday’s flows into Bitcoin exchange-traded funds (ETFs) were negative for the first time since March 1, largely due to $642.5 million in outflows from Grayscale’s GBTC , his largest single-day release on record.

Data provided by Farside shows that GBTC has now seen total outflows of over $12.4 billion, while BlackRocks IBIT has seen $12.96 billion in inflows. Collectively, the ETFs saw a net flow of $12 billion, and now socket 836.6 thousand BTC worth approximately $53.1 billion.

While many crypto naysayers are now saying that the peak of this bull cycle has been reached, the fact that the halving is still over 30 days away indicates otherwise, as typical cycles don’t peak until six to nine months after a halving.

Flows into ETFs have been impressive so far, but they could be just the beginning as the majority of investment advisors have still not started recommending their clients to make allocations to Bitcoin .

According to According to Grant Engelbart, vice president and investment strategist at Carson Group, one of the first advisor platforms to integrate ETFs, only a “handful” of advisors allocated Bitcoin ETFs, and the average allocation was 3 .5%.

Many analysts now view the halving as the next catalyst for Bitcoin and the broader crypto market and see prices moving sideways until then.

“Bitcoin is now an important institutional asset like never before,” said Henry Robinson, co-founder and head of crypto at Decimal Digital Currency, in a note shared with Kitco Crypto. “New Bitcoin ETFs are seeing weekly net inflows of 9-10 figures and holding over 400,000 BTC, over 800,000 including GBTC and over 1,000,000 if we include MicroStrategy.”

“We are seeing this accumulation already starting to affect prices, and the halving effect at current prices will soon mean around $800 million less new monthly BTC supply,” he said. “We expect new all-time highs in 2024.”

Addressing the heavy losses suffered by derivatives traders, Robinson pointed out that “leveraged traders tend to get wiped out when everyone believes profits are a safe bet and sentiments are very bullish. We’re not surprised to see this correction ahead of the halving, liquidating the most extreme bullish bets ahead of a continuation higher, and we would certainly call something like this a “buy the dip” opportunity.

“The BTC market is getting smarter and richer. All this new liquidity from ETFs makes BTC pricing more rational and counters market manipulation,” he said. “More importantly, Bitcoin ETFs have created a foot in the door to raise awareness of Bitcoin among traditional asset managers. They may have ignored it previously out of caution or due to regulatory constraints, but many are taking a closer look and realizing the incredible risk/reward ratio. Adoption is just beginning.

“The market is clearly trying to massively accumulate Bitcoin, but price action takes time to follow local supply and demand,” Robinson concluded. “We could see exuberant bull action, heavy selling, or both, before and after the halving, as market participants move in and out of their halving bets.”

And for those less experienced with cryptocurrency bull markets and the volatility that accompanies them, market analyst Rekt Capital gave the following advice for when to expect a resumption of the Bitcoin bull market.

Disclaimer: The opinions expressed in this article are those of the author and may not reflect those of Kitco Metals Inc. The author has made every effort to ensure the accuracy of the information provided; however, neither Kitco Metals Inc. nor the author can guarantee such accuracy. This article is for informational purposes only. This is not a solicitation to trade any commodities, securities or other financial instruments. Kitco Metals Inc. and the author of this article accept no liability for loss and/or damage arising from the use of this publication.

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