Crypto Bloodbath: $50 Billion Vanishes as Bitcoin price falls to monthly lows

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20 Jan 2024

Bitcoin’s price has continued to decline since the US SEC approved a slew of ETFs this week, dropping to its lowest level since mid-December 2023 of less than $41,000.
Crypto enthusiasts and market professionals blame the decline on asset managers Grayscale’s active sale of BTC. Grayscale’s Bitcoin Trust (GBTC) had already witnessed huge withdrawals totaling $594 million as a result of the current cryptocurrency market collapse. In simultaneously, Grayscale transferred 9,840 BTC to Coinbase Prime for $418 million, bringing the total transaction to 41,478 BTC since January 12.
The landscape for altcoins is very similar, and the whole crypto market capitalization has dropped by about $50 billion overnight.

BTC drops below $41K

Last week was quite volatile, with the SEC approving 11 spot Bitcoin ETFs in the midst of it. The bulls launched a major surge upward, sending Bitcoin to its highest price in over two years, $49,000, on the day the ETFs went live. However, that was followed by a severe retracement, which drove the asset down by $3000. A day later, the situation worsened, as BTC fell by more over $7,000 from its local high.
It recovered some ground during the weekend and remained under $43,000 for the next few days. Following this unusual lack of activity, the bears pressed on their engines once more in the last 24 hours, triggering another free slide.
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This time, Bitcoin fell below $40,800, marking its lowest price point in a month. As of now, it has added a few hundred dollars and sits above $41,000, but it remains 3.5% down on the day.
Its market valuation has fallen to $810 billion, and its control over the Altcoins is well below 50%.

Altcoins Turn Red.

The altcoin space is not flourishing either, with red dominating almost all charts. Ethereum has fallen by 2.5% and now trades below $2,500, after previously trading above that level for several weeks. Ripple, Cardano, Dogecoin, Polkadot, Tron, Chainlink, Toncoin, and Polygon have all experienced 1% to 5% declines.
Solana, Avalanche, ICP, and Uniswap have all declined by 6–9% in the same period. Even more painful drops below come from HNT, SI, ENS, LUNC, and AKT, which have all decreased by double digits in the last 24 hours.
The total market capitalization of all cryptocurrency assets has dropped by $50 billion in a single day, to $1.630 trillion as per CoinPedia.

Traders liquidated almost $250 million irrespective of Bitcoin price fall.

According to Coinglass, the current volume of liquidations is $252.5 million. The most forced closed positions were in Bitcoin (BTC) and Ethereum (ETH).
Earlier, Bitcoin’s price fell below $41,000, hurting traders $81.1 million. Market players who opened long positions in Ethereum also experienced big losses; the price of the second-largest cryptocurrency by capitalization fell to $2,400, losing traders $32 million.
Over 90% of liquidations were divided among OKX, Bybit, Huobi, and Binance. Binance completed the most significant order, closing a long BTCUSDT for $7.31 million.

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Written by Zameer Attar

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Unveiling the Mysteries of Crypto | Analyst Extraordinaire 📊💎Stay tuned for market updates, educational content, and thought-provoking discussions🚀💡