Bitcoin (BTC) experienced a significant price drop as crypto liquidations reached a staggering $661 million in the past 24 hours, affecting nearly 200,000 traders.
On March 15, Bitcoin plummeted by 7.5% within a few hours, going from $72,000 to $66,500. The cryptocurrency managed a slight recovery, reaching the $68,000 level briefly before being rejected and falling further to around $67,500, where it currently stands. This represents an 8.3% decrease from its all-time high of $73,737 on March 14.
The majority of liquidations were long positions, accounting for 80% and totaling $525.2 million. Short positions, on the other hand, resulted in liquidations amounting to $136.5 million.
As a result of the market slump, the overall crypto market capitalization declined by 7.3%, reaching $2.68 trillion, with approximately $175 billion leaving the market.
Greeks Live, a crypto derivatives tooling provider, noted a recent shift in the market tempo on March 14, suggesting that the narrative of ETF inflows may be changing.
Pav Hundal, lead analyst at Australian crypto exchange Swyftx, expressed concern that if ETF volumes continue to decline, there could be a correction back to the low $60,000 or high $50,000 levels.
Data from Farside Investors shows that aggregate spot Bitcoin ETF inflows were at their lowest this month, amounting to just $133 million on March 14.
Crypto trader and analyst CrediBULL Crypto, with a following of 380,000, stated that this drop could be the one that was anticipated.
This recent decline also resulted in a significant reduction in open interest (OI) in derivatives markets. CrediBULL Crypto predicted that there may be further to go, with BTC potentially falling to around $63,000 to $64,000.
The release of economic data in the United States, including the Producer Price Index (PPI) and Consumer Price Index (CPI), may have contributed to the accelerated declines. The PPI data surpassed expectations, leading to projections of prolonged high rates from the Federal Reserve. Additionally, the hotter-than-expected CPI data earlier in the week worsened America’s economic situation.
Asian stock markets also retreated after the U.S. economic data dashed hopes of imminent lower interest rates.
In conclusion, Bitcoin’s price drop and the significant liquidations in the crypto market have been influenced by various factors, including changing market narratives, declining ETF volumes, and economic data releases in the United States.