Bitcoin (BTC) back on track after massive correction
Bitcoin (BTC) back on track after massive correction
The smoke is gradually clearing in the crypto market. The aftershock of a turbulent bitcoin price action is barely noticeable. But more than a few traders are licking their wounds.
The last 24 hours have been anything but boring for Hodler. With a fluctuation range of around 4,600 US dollars, Bitcoin has pulled out all the stops, causing both panic selling and hoarding. At the time of going to press, the cryptocurrency is back in the black, rising by 1.6 per cent on the day to the current level of 31,507 US dollars.
In view of the dizzying price gains of the past weeks, the short breather was only a matter of time. A consolidation was not only foreseeable, but also overdue to cool down the market, which had recently become very heated. Overall, the losses were still limited. In a daily comparison, the total Bitcoin Code crypto market capitalisation recorded a minus of 2.2 per cent, a total of just 10 billion US dollars. At currently 866 billion US dollars, the total market capitalisation is still at a record level. But although there were signs of a correction ahead, traders gambled away with bitcoin futures.
Largest liquidation of bitcoin long positions
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Burning money is probably the best way to describe it: On the Bitcoin exchange Binance alone, long positions for the equivalent of 190 million US dollars were liquidated during yesterday’s trading. The spectacle lasted just 10 minutes, pushing the bitcoin price straight down from 32,000 to 28,000 US dollars.
Chart: https://t.co/qr7Ti38az9 pic.twitter.com/lHsGAE4nqs
– glassnode (@glassnode) January 4, 2021
The massive price dynamics make it clear: the positioning of futures contracts on the crypto market is a hot ride. The euphoria of the last trading weeks has long traders turning a blind eye to a possible setback. No wonder, after all, the majority of investors with long positions have recently cashed in well. But this time they lost out to sellers of short positions. The futures market formed around Bitcoin remains a casino that can bring exorbitant profits as well as losses. Especially since the largest liquidation of long positions in terms of trading volume has once again illustrated the great influence of futures on the Bitcoin price.
Number of small Bitcoin investors is growing
While mainly large investors have burnt their fingers in derivatives trading, interest in Bitcoin among small investors is steadily increasing. With currently over 33 million addresses, the number of wallets holding a bitcoin amount has set a new all-time high.