New York, NY – The newest market turmoil has seen the price of the world’s most significant cryptocurrency plummet to lows not seen since February, causing a chain reaction of liquidations totaling hundreds of millions of dollars. CoinGlass data reported an escalation in liquidations of long positions to over $500 million within the last 24 hours, marking the most extensive single-day wipeout in the crypto market since mid-April. Notably, an additional $80 million in short positions were also liquidated amidst the market turmoil.
Bitcoin, the focal point of the recent market downturn, experienced a dip to as low as $55,000 late Thursday before mounting a slight recovery to around $55,550, according to CoinGecko. The struggles of Bitcoin to surpass $60,000 have been attributed to growing investor uncertainty, exacerbated by apprehensions surrounding a $2.7 billion transfer from the Mt. Gox bankruptcy estate’s cold storage to an unknown wallet. Ethereum, the second-largest cryptocurrency globally, also suffered a significant drop, falling over 4% below the $3,000 mark for the first time since May 17.
A prevailing sense of unease over the U.S. Federal Reserve’s ability to manage inflation this year has cast a shadow on risk assets, including cryptocurrencies. Consequently, experts are predicting a further decline in Bitcoin’s value to $52,000, underscoring the potential for continued price pressure on the crypto market. The ongoing sell-off reflects a lack of investor confidence and a broader market sentiment influenced by factors beyond the digital asset realm.
The latest market downturn serves as a stark reminder of the volatile nature of cryptocurrencies and the susceptibility of digital assets to external factors such as regulatory uncertainties, macroeconomic conditions, and investor sentiment shifts. While market participants grapple with the implications of the recent price drops, the crypto market’s resilience and ability to rebound from past downturns remain a point of interest and speculation among industry observers. Amidst the uncertainty, market analysts are closely monitoring key price levels and market indicators to gauge the trajectory of the crypto market in the coming weeks.