Market Jolt: Bitcoin Falls Below $42,000 As Short Term Holders Rush To Cash In
12 Dezember 2023 - 2:00AM
NEWSBTC
Bitcoin is currently witnessing a decline in price, with its value
dropping below the $42,000 mark. This movement comes on the heels
of a significant uptick in the circulating supply of profitable
Bitcoin, prompting a wave of profit-taking among investors. ETC
Group’s Head of Research, André Dragosch, highlights this trend,
noting an increase in Bitcoin being moved to exchanges for
potential sale. Dragosch noted, citing data from Glassnode: Overall
exchange balances for bitcoin have clearly picked up, implying a
net inflow of coins to exchanges over the past week. More
specifically, around +14k BTC have flown into exchanges on a net
basis according to data provided by Glassnode. This will likely
exert some downside pressure on prices in the short term. Bitcoin
Short-Term Holders Drive Selling Pressure According to the ETC
Group, the current market scenario presents a landscape where a
substantial portion of Bitcoin and Ethereum addresses are
profitable. Data from the firm indicates that 88.3% of BTC
addresses and 77.6% of ETH addresses are currently profitable,
figures hovering near the highest for the year. Related Reading:
The Bitcoin Spot ETF Boom: VanEck Forecasts $2.4 Billion Inflows In
Q1 2024 This environment of a high percentage of BTC and ETH
addresses being in a state of profit has seemingly encouraged a
segment of investors, particularly those with a short-term
investment perspective, to capitalize on their gains, as indicated
by the ETC Group’s analysis. The ETC group further revealed that
these short-term investors, defined as those who have held Bitcoin
for less than 155 days, have been transferring their profitable
assets to exchanges at a rate not seen since July of this year.
This surge in selling pressure is attributed to a key factor
restraining the Bitcoin rally as the market adjusts to the
increased availability of the cryptocurrency. Further illustrating
the market’s reaction, the past week marked the first instance of
“net outflows” from crypto asset exchange-traded products (ETPs)
since early October. The total amount of these outflows was
approximately $18.2 million, with Bitcoin ETPs experiencing the
majority of these withdrawals, totaling $13.1 million. In contrast,
Ethereum ETPs saw a “net inflow” of $5.8 million, suggesting a
diverging investor interest between the two leading crypto. Market
Impact And Trader Liquidations The recent decline in Bitcoin’s
price from its previous high of around $44,000 has impacted
investor sentiment and resulted in significant trader liquidations.
According to data from Coinglass, over the last 24 hours, there
have been 115,873 trader liquidations, culminating in roughly
$424.67 million in total liquidations. Bitcoin has led these
liquidations, with $105.51 million in long liquidations and $14.95
million in short liquidations. Ethereum follows closely, accounting
for $78.53 million in long and $7.41 million in short liquidations.
Related Reading: Holding For Gold: Micheal Saylor’s Poll Unveils
Bitcoin Enthusiasts Aiming For $1 Million Mark It is worth noting
that these liquidations and the fluctuating market dynamics
underscore the division of trader’s fate in the crypto market.
While some investors seize the opportunity to realize profits,
others face the challenges of rapid market shifts. Featured image
from Unsplash, Chart from TradingView
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