This Is Why Bitcoin, ETH, SOL, XRP, and SHIB Dropped So Hard During The Crypto Market Crash

The collapse of the cryptocurrency market occurred when Bitcoin fell to $65,000, which caused a correction in altcoins like as ETH, XRP, SOL, ADA, SHIB, and DOGE.

  • Options expiration-related selloff in the cryptocurrency market evolved into a meltdown due to macroeconomic causes and sour attitude.
  • Amidst profit booking, $950 million was liquidated in the cryptocurrency market.
  • According to QCP Capital, Bitcoin may drop below $65,000 further, and other analysts projected a sharp decline in price following the halving.

The prices of Ethereum and Bitcoin are currently being pressured by sellers.

The global crypto market value dropped to $2.38 trillion after a severe correction in the crypto market that saw a decline of more than 8%. The latest selloff in the cryptocurrency market resulted in a loss of nearly $250 billion in market value overall.

Due to several variables, including options expiration, past Bitcoin halving patterns, macroeconomic concerns, and technical chart weakness, the price of Bitcoin fell from $70,978 to $65,254o. The cryptocurrency market saw a selloff after Bitcoin, sending Ethereum's price down by 12%. Altcoins like SOL, XRP, ADA, DOGE, SHIB, and others had a 15–30% decline as a result. Among the most liquidated cryptocurrencies during the past day are meme coins.

Options Expiration Started the Crypto Market Selloff, and Other Factors Made It Continue
In fact, early this week, the crypto market began to exhibit symptoms of weakness ahead of the U.S. CPI data. According to CoinGape, the increase in Bitcoin price to $72k was a range-bound move in response to the growing influx of Bitcoin ETFs and demand for long positions because of fear of a Bitcoin halving.

Prominent analysts including Benjamin Cowen, Peter Brandt, and Arthur Hayes forecasted a decline, perhaps leading to a market meltdown, should the price of BTC replicate a comparable chart pattern observed in the past at Bitcoin halving occasions and the most recent listing of Bitcoin ETFs. After the halving, Cowen estimated that the price of Bitcoin may go below $60,000.

After options expire, CoinGape also projected a decline in the price of ETH and BTC. The accompanying chart makes it evident that the options expiry at 12 PM UTC marked the beginning of the crypto market selloff. The reasons were tempered sentiment following the hotter CPI, dominating sell transactions in the derivatives market amid low volumes, and lower maximum pain points than the trading prices.

The price of bitcoin breached significant support levels around $70,400 and $68,200, extending the selloff as a result of Middle East geopolitical unrest and unfavourable sentiment following big bank earnings releases. On Friday, JPMorgan Chase's stock dropped 6.47%.

The US dollar index (DXY) surged above 106, the highest level since early November, as a result of the global macroeconomic developments, while the US 10-year Treasury yield shot up to a 6-month high of 4.585%. Since Bitcoin moves against the DXY and Treasury rates, an increase in both has resulted in a drop in the price of Bitcoin to $65k and a meltdown of the cryptocurrency market.

The Correction in Cryptocurrency Prices Is Not over, however.

According to Coinglass data, during this severe drop, the cryptocurrency market saw the liquidation of almost $950 million. On the last day, almost $120 million worth of short positions and $830 million worth of long holdings were liquidated.

More than 297K traders were liquidated, and the biggest liquidation order ever occurred on the cryptocurrency exchange OKX when a trader converted ETH to USD for a total of $7.19 million.

Although QCP Capital is still structurally bullish, it thinks deleveraging declines have room to grow, especially given the magnitude of this year's bull run. It means that those who are hedging against short-term declines should take into account the price of bitcoin on May 31.

After the halving event, according to 10x Research CEO Markus Thielen, bitcoin miners may sell $5 billion in cryptocurrency, with whales driving the selloff.

The price of bitcoin is currently trading at $67,211, and if it stays below support and doesn't rise above the 20-simple moving average, selloff pressure will likely persist. At the time of writing, the price of ETH is $3,252.


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