- Bitcoin dipped over 3% to $59,800 on Wednesday.
- Traders liquidated over $115 million in assets within four hours.
Based on data from Coincodex, Bitcoin experienced an over 3% price dip in Wednesday’s trading session, sliding to 59,800. This value downturn coincided with the overall drop in trading volumes, slipping by 12% to $40 billion.
Insights from CoinGlass pointed to traders’ liquidation of trading positions as a reason for this downward movement. Investors sold off over $115 million of assets within four hours, with long positions accounting for $96.70 million and making up the remainder. The bulk of these liquidations, totaling $43.81 million, occurred on the OKX platform.
Moreover, market analysts suggest that the Bitcoin Halving event may have caused traders to adjust their positions. The halving event will see Bitcoin rewards cut in half, potentially impacting the supply of coins entering the market, a factor that some market participants view positively.
This event and other factors contributed to increased volatility in Bitcoin’s price leading up to the halving. Furthermore, investors have been withdrawing funds from popular Bitcoin ETFs following remarks by U.S. Federal Reserve Chairman Jerome Powell regarding the need for further progress on inflation before considering rate cuts.
Bitcoin’s Price Volatility Amidst Geopolitical Tensions and Halving Anticipation
Markus Thielen, head of research at 10x Research, expressed that crypto miners have accumulated Bitcoins since January 2024, creating an imbalance between supply and demand. This accumulation drove BTC’s price sharply higher, reaching its historical peak in March. Nonetheless, digital asset mining companies are expected to sell their accumulated holdings after the halving event, potentially affecting cryptocurrency prices.
According to reports from Reuters, Bitcoin experienced a sudden drop of more than 5.5% to $59,961 following reports of an Israeli missile strike on Iran early Friday morning. However, it quickly rebounded, recording an intraday rally of 5.52% to $65,297.82. Bitcoin’s price decline occurred just ahead of the cryptocurrency’s halving.
Moh Siong Sim, a currency strategist at the Bank of Singapore, attributes this volatility to market participants’ flight to safety amid geopolitical uncertainties. He emphasizes the need to assess the extent of potential retaliatory actions before gauging the market’s reaction.