On the 4th of July, the cryptocurrency market witnessed a significant event as the value of Bitcoin (BTC) momentarily plunged to $57,874 on Coinbase, marking the first occasion in over two months that the digital currency’s price has descended beneath the $58,000 threshold.
Subsequently, Bitcoin’s value stabilized, trading at $58,964 at the time this article was written, although it has experienced a 3.4% decline over the past week, according to the data provided by TradingView.
For the first time in a span of two months, Bitcoin’s value has dropped below $58,000. Credit: TradingView
This downturn in Bitcoin’s value coincides with the liquidation of leveraged long positions amounting to millions of dollars, adversely affecting traders who were optimistic about a rise in Bitcoin’s price. Data from CoinGlass reveals that Bitcoin long positions exceeding $54.9 million have been liquidated in the past day.
In the last day alone, Bitcoin long positions nearing $60 million have been liquidated. Source: CoinGlass
In a similar vein, traders who were anticipating to profit from long positions in Ether (ETH) in the lead-up to the anticipated launch of multiple spot Ether ETFs, projected to occur by mid-July, found their positions eliminated as well. The past 24 hours have seen the liquidation of ETH long positions totaling $57.9 million.
In related news, analysts have identified three key reasons why they believe a ‘cycle top’ for Bitcoin’s price may have been reached.
The broader downturn in Bitcoin’s price has largely been attributed to the now-defunct Japanese cryptocurrency exchange Mt. Gox, which is poised to commence the repayment process of approximately $8.5 billion in BTC to its creditors starting early July. Nonetheless, some market analysts are of the opinion that the repayments might not have as catastrophic an impact on Bitcoin as some might expect.
The sudden dip in Bitcoin’s price below $58,000 also triggered a sell-off among other major cryptocurrencies and altcoins. At the time of writing, Ether has fallen by 4.5%, briefly touching a low of $3,145 during a steep sell-off at 2:00 am UTC on July 4. BNB (BNB) has seen a 6% decrease, dropping from $573 to $539. Solana (SOL) has also seen a significant reduction in its recent gains, with a 10.3% drop in the last 24 hours, falling from a weekly peak of $154 to $136 at the time of reporting.
Concurrently, the phrase “buy the dip” has seen a surge in mentions across various social media platforms over the past couple of days, with its usage doubling on Reddit, X, and 4Chan within the same period.
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The recent downturn in Ethereum’s value may present an opportunity — Dynamo DeFi