The Bitcoin (BTC) price has fallen sharply and is recording great losses. The Bitcoin course quickly lost value. This is also known as a BTC dump. The picture shows a crumbling Bitcoin price on a descending price graph.
The Bitcoin price fell from around USD 11,400 to USD 10,600 this afternoon. The BTC price is thus approx. 7% lost on the previous day. The reason for this was probably an increasing supply of Bitcoin on the various exchanges. This made the pressure to sell too high and the demand could no longer fight it. At least that is evident from the numbers of some analysis platforms.
Bitcoin price collapses
The Bitcoin course only fought its way back to the USD 12,000 mark a few days ago. However, there was insufficient momentum to break this resistance. This fact probably not only unsettled many traders, but also other Bitcoin Code investors and BTC miners.
The sharp drop in the Bitcoin price is directly related to the influx of 92,000 BTC on various exchanges. Many of these transfers came directly from the wallets of the various Bitcoin miners. In addition, the inflow represented the largest increase in the last 37 days.
Bitcoin selling pressure was too high
Philip Gradwell, Chief Economist at Chainalysis, revealed on Twitter that a significant amount of BTC has been transferred to Exchanges. He also said that many traders had their price target at $ 12,000. This has led to additional selling pressure and caused the Bitcoin price to drop even further. Additionally, he pointed out that the market did not fully absorb the 92,000 BTC.
Gradwell published further data on Twitter to make it clear that the demand at that time was not enough to cope with the 92,000 Bitcoins without falling prices. He published a chart for BTC trading intensity. The higher this value, the higher the current demand and thus also the pressure to buy. Today, however, the trading intensity was 3.113, below the 180-day average.
Short-term fluctuations in the Bitcoin price are not unusual
Ultimately, such Bitcoin price drops cannot be precisely measured. There are a variety of different reasons that could have triggered this sell-off. Although Bitcoin is considered uncorrelated to most traditional assets , there has often been counter-evidence in the past. Accordingly, the Bitcoin price sell-off could have something to do with a fall in the S & P500.
In the long term, the current Bitcoin price fluctuations do not play a major role. With such a small market, you have to expect strong movements in both directions. That will settle over time as Bitcoin’s market capitalization increases. Therefore, there is currently absolutely no reason to panic for long-term investors.
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