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The cryptocurrency market has continued its downward spiral. Bitcoin, Ethereum, and quite literally every other crypto on the top 20 is in the red as of the time this article was written. Bitcoin has decreased by nearly 5% in the past day, Ethereum has decreased by over 5%, BNB and Solana have decreased by 7% and 10% respectively.
As investors struggle to understand the market, let’s examine some of the reasons why our market is bleeding profusely.
So, the highly-anticipated Bitcoin halving is scheduled to kickstart in about four days, give or take. Typically, as we all know, markets love halving. They tend to surge remarkably moments before, during, and especially after it. 2024 started off with a bang, and we saw Bitcoin smash not one but two all-time highs, inspiring several highly bullish predictions from experts in and outside the industry. People were investing in Bitcoin in a typical FOMO fashion. Markets went ballistic. Things were good.
But then, the corrections came. Experts assured us that they were expected pre-halving. Investors calmed down and stayed put. But unfortunately, over the weekend, the market tumbled in a way that hasn’t been seen since the start of the year.
The ongoing geopolitical tensions between Iran and Israel became intertwined with crypto markets because cryptos were the only tradable assets during the attack. Investors started liquidating their holdings like there was no tomorrow. And the crypto market started to bleed.
This started a massive trend of selloffs and we saw hundreds of mill of dollars sold in the span of just two days. Interestingly, however, this inspired a surge in trading activities on multiple exchanges, including Coinbase, Binance, and Bybit.
Clearly, as investors ditched the market, traders saw an opportunity to make rounds. This is a common occurrence. But it doesn’t mean that traders are bullish. They’re not. Latest figures from Coinglass show a huge uptick in Bitcoin derivatives trading, with volumes surging by over 10% in the past day to hit $99 billion. The current long/short ratio stands suggests a largely bearish sentiment among traders.
Still, experts are not deterred. Predictions of Bitcoin hitting $100k, Ethereum hitting $10k, and BNB hitting $5k are still being maintained.
