Bitcoin price falls by 17% as analysts predict an eventual crash to $55,000 

Temitope Akintade
Today’s drop extends one of Bitcoin’s worst weeks this year…
Bitcoin rises to $62,508 following Trump's assassination attempt

Flagship digital asset Bitcoin isn’t having a great start to the week. The market has shown bearish sentiment in recent days and the trend continues on Monday as Bitcoin led other major cryptocurrencies into a decline, with data showing that the potential to recover these losses looks unlikely in the coming days with several indicators hinting at more price slides ahead.

Today’s drop extends one of Bitcoin’s worst weeks this year.

At press time, Bitcoin is exchanging hands at $60, 897, down 5.21% in the past 24 hours and 7.59% in the past week. This is the landmark crypto coin’s lowest price since May 15. The current price is 17% below the all-time high of $73,740 reached on March 14, according to data from Coinmarketcap. 

Read also: Hamster Kombat: Here is all you need to know about the new Telegram tap-to-earn game

Similarly, major altcoins registered bigger drawdowns. Data shows that the second largest cryptocurrency by market cap, Ether posted a price drop of 5.37% to sell at $3, 306 over the past day. Also, SOL saw a 7.07% drop as it currently trades at the $126 mark.

The global cryptocurrency market cap has decreased by around 4.65% in the past day, now at $2.24 trillion.

Bitcoin price crashes below $41,000; here is why you should be cautious about buying the dip

Observers have noted that Long liquidations are responsible for the sharp decline in the prices of the crypto coins. Liquidations happen when a trader’s position is automatically closed due to insufficient funds to sustain trading. This is typically caused by market fluctuations that erode their initial margin or collateral.

According to data from Coinglass, there were over $97 million long liquidation-related Bitcoin transactions across centralized exchanges in the past 24 hours — out of a total of $106 million in liquidated BTC positions. Ether, the second-largest cryptocurrency, also faced significant liquidations, with $64 million liquidated. Of these transactions, $59 million were long liquidation-related.

Overall, the broader cryptocurrency market witnessed a total of $285 million worth of transactions. Of these, around $260 million worth of transactions were long positions-related.

Consequently, the Crypto Fear and Greed Index, which measures crypto market sentiment, has dropped to a “Neutral” score of 51, the lowest it has been in 51 days since Bitcoin fell below the critical $60,000 level to $59,122.

Also, data from Farside indicates that Spot Bitcoin exchange-traded funds (ETF) have recorded a string of outflows over the past six trading days. 

What are investors selling?

Analysts have attributed the price crash to large sales from Bitcoin whales and reactive sentiment to the German government moving a significant amount of BTC to exchanges.

A report indicated Bitcoin whales (entities with large holdings of the token) sold over $1 billion worth of BTC in the first two weeks of June alone. In the last two days, the whales have slowed their transaction activity, just before Bitcoin’s price slipped below $63,000. 

MicroStrategy acquires $490m worth of Bitcoin, Now Holds Over 105,000 Total

Also, the German Federal Criminal Police Office (BKA), which had seized almost 50,000 BTC from a piracy site in 2013, reportedly moved tens of millions worth of BTC to crypto exchanges such as Coinbase and Kraken last week.

Read also: NIMC denounces NIN, BVN data breach allegations, warns Nigerians against phishing sites

What should Bitcoin investors expect next?

It doesn’t look like the Bitcoin and crypto market will see any upside in the coming days. Some analysts have predicted a drop in the price of the landmark coin to around $55,000 soon.

Bitcoin price

Popular trader Crypto Ed in an X (Twitter) post said.

BTC looks weaker than I expected and should see some more downside.”

Founder of Galaxy Digital Holdings, Michael Novogratz eyes had already predicted that bitcoin will trade around the $55,000 – $60,000 zone throughout Q2 2024.

With the enthusiasm around BTC spot ETF approval and Bitcoin Halving now fading, it is expected that new market events will be the only catalyst that will pull the market out of the current slump.

Technext Newsletter

Get the best of Africa’s daily tech to your inbox – first thing every morning.
Join the community now!

Register for Technext Coinference 2023, the Largest blockchain and DeFi Gathering in Africa.

Technext Newsletter

Get the best of Africa’s daily tech to your inbox – first thing every morning.
Join the community now!