In the last 24 hours, Bitcoin’s value plummeted by over 7%, which resulted in significant financial losses amounting to $256 million for traders holding long positions.
This drop is part of a broader trend, not considered unusual by experts, even amid rising geopolitical tensions in the Middle East.
According to Benjamin Cowan in a recent post on X dated April 13, such drops are par for the course in the current market cycle.
“So far, this is a normal drop. In fact, we’ve had several 20-22% drops this cycle,” Cowan explained.
Similarly, Michael Saylor, CEO of MicroStrategy, remains bullish, asserting on the same day on X that, “Chaos is good for Bitcoin.”
In the face of these declines, Rekt Capital, a pseudonymous cryptocurrency trader, suggested that Bitcoin’s current price dip is a precursor to a recovery, though it will likely test investor resolve.
“Bitcoin will retrace deep enough to convince you that the Bull Market is over,” Rekt stated, indicating a belief in the eventual resurgence of Bitcoin’s value.
On the specific details of the plunge, Bitcoin’s price fell to a low of $60,919 before stabilizing around $62,060, and later recovering slightly to $63,858, as reported by CoinMarketCap.
The sharp decline also triggered broader market liquidations, with a total of $319.15 million wiped out from leveraged Bitcoin positions in the same timeframe, comprising $256.58 million from long positions and $62.58 million from shorts, according to data from CoinGlass.
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Further risks loom as short traders are poised for potential liquidations worth $1.05 billion should Bitcoin revert to its previous 24-hour high of $67,000.
The larger cryptocurrency market felt the ripple effects, with a staggering $945.9 million liquidated from 253,554 traders overall.
Market sentiment, as measured by the Crypto Fear and Greed Index, also saw a downturn to a greed level of 72 from last week’s 78, indicating a shift in trader perception.
Additionally, the global crypto market cap has decreased by 8%, dropping to $2.23 trillion.
Despite these challenges, demand for Bitcoin remains robust, particularly among long-term investors or “permanent holders.”
Cointelegraph reports that according to CryptoQuant, demand now surpasses the supply of new Bitcoin entering the market, a trend expected to intensify following the upcoming Bitcoin halving, further underscoring the growing scarcity of the cryptocurrency.
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