Due to the pressure wave of liquidated futures contracts, the Bitcoin price popped below 50,000 US dollars over the weekend. El Salvador did not miss the opportunity. The market update.
What a weekend. On Friday it was already hinted at, but one day afterwards it unmistakably hit the crypto market. The Bitcoin price rattled to US $ 46,000 at times and has lost US $ 10,000 in value in just 24 hours. For the first time in two months, the BTC market capitalization is again below one trillion US dollars. With a minus of 1.4 percent, Bitcoin also overslept the beginning of the week. At the time of going to press, the BTC price is trading at $ 48,650.
The altcoin market is also up and down. In a 24-hour comparison, the number 2, Ethereum (ETH), lost 2.3 percent, but with a narrow cushion of 100 US dollars, it is holding back just over 4,000 US dollars. Binance Coin (BNB) and Cardano (ADA) record setbacks in the range of three percent, with Solana (SOL), XRP and Polkadot (DOT) the losses are around six percent on a daily basis. The newcomer in the top ten, Terra (LUNA), has dropped a full eleven percent, but after the token hit a new record high at USD 77 overnight. Instead of panic selling, profit-taking should cloud the LUNA hourly chart.
Chain reaction on the futures market
Like the on-chain data service provider Glass node the break-in on twitter dissected, there were indeed increased sales by short-term investors. But not enough for such a landslide. Rather, the drastic Bitcoin slump accelerated due to over-leveraged futures contracts on the futures markets.
“With nearly 25 percent of futures contracts closed, we can determine that a leverage flush is the most likely driver on the sell side,” writes Glassnode. The extent of liquidated futures contracts was therefore the “second largest one-day event of 2021”, only surpassed by the May 19th crash.
El Salvador on the Bitcoin bargain hunt
A good opportunity to refresh wallet stocks. As in El Salvador, where the dip according to President Nayib Bukele was used to add another 150 Bitcoin to the treasury. The equivalent of the investment at a Bitcoin exchange rate of $ 48,670: $ 7.3 million.
The weekend, which for most crypto investors was one to forget, attracted well-heeled bargain hunters to the scene, who took advantage of the downward trend to make additional purchases. Whether a dramatic sell-off or a favorable opportunity is therefore a question of perspective.