Bitcoin dropped to under $17,800 on Saturday afternoon due to an increasing sell-off. Two hours later, it bounced back to around $19,000. Bitcoin hit its all-time high of $68,789.63 in November.
“What we’re seeing is more liquidations driving prices and sentiment lower, which triggers more liquidations and negative sentiment — some flushing-out needed still, but this will at some stage exhaust itself,” Noelle Acheson, head of market insights at Genesis, said.
The total liquidations in the past 24 hours are $566.7 million, including $271 million of Bitcoin.
“Investors are continuing to position defensively following last year’s liquidity-driven digital asset bull market,” Alkesh Shah, head of digital assets strategy at Bank of America, said. “Although painful, removing the sector’s froth is likely healthy as investors shift focus to projects with clear road maps to cash flow and profitability versus purely revenue growth.”