Bitcoin‘s value plummeted to $56,952 today, with altcoins experiencing losses of over 8%. Investors are concerned due to an excessive supply of billions of dollars. Additionally, miners and long-term investors joining the selling spree could extend the series of losses within the cryptocurrency market. Alarmingly, the primary drop is anticipated to occur tomorrow.
Will Cryptocurrencies Continue to Decline?
The ongoing sales could potentially push Bitcoin to its $50,000 base, even though it currently hovers above $56,000. According to CoinGlass data, Bitcoin liquidations in futures have surpassed $100 million. This figure is significantly higher in comparison to the previous weeks’ liquidations. The continuous three-day negative streak for Bitcoin initiated the primary loss series as the Asian markets began trading.
The Spot Bitcoin ETF has not shown significant outflows recently. Yesterday, there was a net outflow of $20 million, with most sales originating from GBTC, accounting for $27 million. The remaining $7 million was offset by other ETFs.
What Awaits Spot Bitcoin ETFs?
The main drop could potentially happen tomorrow. Bitcoin’s price dropped by 5% in a single day, and ETF investors won’t be able to trade today due to the US markets being closed for Independence Day. The markets will reopen tomorrow, possibly triggering excessive sales by ETF investors returning after the holiday. This poses a risk of the drop being priced near today’s daily close.
Insights for Investors
Key observations for stakeholders:
- Bitcoin liquidations in futures have significantly increased, surpassing $100 million.
- Spot Bitcoin ETF witnessed a net outflow of $20 million, primarily from GBTC.
- The reopening of US markets might lead to increased sales by ETF investors.
Investors have a chance to purchase altcoins at last year’s mid-year prices. However, confidence is still low due to the risk of further declines.
In conclusion, the cryptocurrency market faces potential challenges with significant price drops expected. Investors should remain cautious and consider the outlined key observations to make informed decisions.