Crypto

Bitcoin Plunges 7.5% to $65K, $847.6M in Bets Liquidated

Bitcoin plunges 7.5% to $65,214 amid a marketwide sell-off, with $847.6 million in crypto liquidations as risk aversion spikes.

By Barry Stearns

4/12, 15:41 EDT
Bitcoin / U.S. dollar
article-main-img

Key Takeaway

  • Bitcoin fell 7.5% to $65,214 amid global risk aversion, marking its lowest level since April 5.
  • Solana and Dogecoin saw steeper declines of about 12% and 13%, respectively, as traders liquidated bullish bets.
  • Total long position liquidations reached $847.6 million, despite Bitcoin's approximately 60% gain this year due to halving anticipation.

Bitcoin's Sharp Decline

Bitcoin experienced a significant drop, plunging 7.5% to a low of $65,214, marking its lowest level since April 5. This downturn was part of a broader sell-off in the cryptocurrency market, with smaller tokens like Solana and Dogecoin facing even steeper declines of around 12% and 13%, respectively. The sell-off was triggered by a renewal of risk aversion in global financial markets, spurred by geopolitical tensions that led investors to seek safety in bonds and the dollar, while oil prices rallied.

Liquidation Surge

The market witnessed a substantial liquidation of bullish bets on cryptocurrencies, with data from Coinglass revealing about $417 million in long liquidations in just one hour. Over the past four and 12 hours, long position liquidations amounted to $663.9 million and $751 million, respectively, culminating in total liquidations of $847.6 million. This wave of liquidations reflects the high volatility and risk associated with leveraged positions in the crypto market.

Marketwide Impact

The downturn affected a broad range of cryptocurrencies, with major tokens such as Ether, Cardano's ADA, and BNB Chain's BNB experiencing similar losses of up to 8%. The broader CoinDesk 20, which tracks the most liquid cryptocurrencies excluding stablecoins, dropped by 8.25%. The sell-off was partly attributed to the U.S. February Producer Price Index (PPI) coming in higher than expected, dampening hopes for a rate cut and contributing to the market's sharp decline.

Traders' Outlook

Despite the immediate bearish sentiment, some traders maintain a long-term bullish outlook on Bitcoin. John Glover, Chief Investment Officer at Ledn, expects a correction to the $55,000-$62,000 range before the next upward movement, citing the upcoming Bitcoin halving and the anticipated influx of retail investors into BTC ETFs as positive catalysts. However, Alex Kuptsikevich, a senior market analyst at FxPro, cautioned about the potential for further losses, highlighting the importance of the $65.0-$65.5K and $60.0-$60.5K levels as key areas of interest for both retail and technical traders.