Altcoins
Cryptocurrency Market Crash Hints at Unexpected Turn as Bitcoin Hits New Lows
The combined market capitalization of cryptocurrencies fell by more than 11% in 48 hours, causing investors to lose $250 billion. market capitalization Bitcoin price has fallen by more than 8% in the last 24 hours, which has put the sector back into a bearish trend. Bitcoin price hit a 24-hour low of $53,485, falling below the key support level and at risk of a collapse to $52,000.
Altcoins including Ethereum, BNB, Cardano, XRPand Toncoin fell by more than 15%. On the other hand, Solana ecosystem tokens and meme coins, as well as some AI coins, have further extended their double-digit declines over the past 48 hours.
Cryptocurrency market sentiment falls back into fear due to panic selling by investors ahead of Mount Gox $10 billion in BTC and BCH repayments starting this week. JPMorgan and CoinShares have warned of a market shake-up amid fears of a potential sale by creditors.
The cryptocurrency market is officially in a bearish phase
According to Coinglass, $680 million worth of cryptocurrencies have been liquidated in the past 24 hours. Over 232,000 traders have been liquidated, with the largest single liquidation order on cryptocurrency exchange Binance, ETHUSDT, valued at $18.48 million.
Nearly $590 million in long positions and $90 million in short positions were liquidated in the past 24 hours. Investors lost over $150 billion in the past 24 hours as the cryptocurrency market cap fell from $2.24 trillion to $1.99 trillion.
Meanwhile, more than 17,500 BTC options Bitcoin with a notional value of $1.02 billion is set to expire, with a put/call ratio of 0.67. The maximum pain point is 61,500, implying that Bitcoin price will remain under selling pressure as BTC fell below $54,000 today.
Notably, the put/call ratio over the past 24 hours has climbed over 1.09, with put volume above 17,200 and call volume near 15,793. This indicates that options traders have become very bearish on Bitcoin.
Implied volatility (IV) across all terms is showing significant declines, meaning that a market recovery into uncertain price movements will see BTC price drop below $52,000.
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Governments are selling bitcoins
The US and German governments have transferred millions of BTC in the past few hours, according to Arkham. The US government wallet address transferred 237 BTC related to the funds seized by Potapenko/Turogin to the address starting with bc1qvc.
In addition, the German Government Bitstamp, Coinbase, and Kraken also sold 1,300 BTC. They also transferred 1,700 bitcoins worth $98.76 million to an unknown wallet.
The transfers made by these wallet addresses triggered panic among investors and traders, causing the price of BTC to fall further below the $54,000 level.
Macroeconomic impacts continue to amplify
Fed Chairman Jerome Powell The latest speech and the release of the FOMC minutes confirmed Fed officials’ aggressive stance on rate cuts this year. The election saga with Trump in the lead after the last debate has increased pressure and Fed officials are awaiting fresh data on US inflation and the labor market.
CME FedWatch The Fed’s forecast for two rate cuts this year is rising. The probability of a 25-bps rate cut in September has increased to 66.5% from 59% last week. Weak U.S. economic data has reinforced the Fed’s forecast for rate cuts this year.
US Dollar Index (DXY) held around 105 on Friday after hitting a three-week low in the previous session. Additionally, the 10-year U.S. Treasury yield fell to 4.35% after the latest ISM and employment data showed a slowdown in the labor market.
Analysts predict that a market rebound could happen at any time and shorting Bitcoin and altcoins could turn out to be the worst move. Thus, they believe that a consolidation near the current level and a rebound above $58,000 by the end of the week is expected.
“A decrease in USDT liquidity will not drive BTC growth, rather, the growth will demonstrate the demand to buy coins,” according to an on-chain analyst.
Read also : Donald Trump Presidency Could Trigger ‘Global Hash War’ With BTC Reserves, Says Bitcoin Maxi
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Varinder has 10 years of experience in the Fintech industry, with over 5 years dedicated to blockchain, crypto and Web3 developments. A tech enthusiast and analytical thinker, he has shared his knowledge of disruptive technologies in over 5,000 news stories, articles and papers. With CoinGape Media, Varinder believes in the huge potential of these innovative technologies of the future. He is currently covering all the latest updates and developments in the crypto industry.
The content presented may include the personal opinion of the author and is subject to market conditions. Do your market research before investing in cryptocurrencies. The author or publication assumes no responsibility for your personal financial losses.