The cryptocurrency market experienced a sudden and sharp drop on Friday, April 12, in which the price of bitcoin and the value of other large-cap assets took serious hits. The price of bitcoin, which has moved mostly sideways over the past few days, fell below the $67,000 mark for the first time in more than a week.
As a result of the steep drop, the crypto market has witnessed nearly $900 million in liquidations in the last 24 hours. According to Coinglass futures market data, losses from leveraged bitcoin and Ether positions are responsible for the majority of liquidations.
On-chain analytics firm Santiment has revealed the driving factor behind the latest drop in bitcoin price and the overall crypto market decline.
Here's why btc price fell below $67,000
The price of bitcoin has fallen approximately 5% in the last day, falling from over $70,000 to below $67,000 in five hours. This is the top cryptocurrency's first drop below the $67,000 mark since April 4, according to blockchain intelligence firm Santiment.
The value of Ether, the second-largest cryptocurrency by market cap, saw an even steeper decline, falling nearly 8% in less than 24 hours. The performance of the two largest digital assets puts the current state of the crypto market into perspective.
Interestingly, the recent drop in cryptocurrency market prices has not been isolated, as traditional assets have also seen a significant correction. Santiment revealed in his latest x.com/santimentfeed/status/1778899101939011588″ target=”_blank” rel=”noopener nofollow”>report that the S&P 500 index and gold prices also fell 1.5% and 3.4%, respectively.
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twitter.com/hashtag/bitcoin?src=hash&ref_src=twsrc%5Etfw” rel=”nofollow noopener” target=”_blank”>#bitcoin
– Sentiment (@santimentfeed) twitter.com/santimentfeed/status/1778899101939011588?ref_src=twsrc%5Etfw” rel=”nofollow noopener” target=”_blank”>April 12, 2024
According to the on-chain analytics firm, the notable price decline in both the crypto asset and traditional asset sectors is linked to concerns over CPI and inflation. The CPI, the consumer price index, is a metric that measures the inflation (or the change in the prices of goods and services) experienced by consumers.
The recent stock market and bitcoin price crash appears to have been the result of continued inflation, causing the Federal Reserve (Fed) to maintain higher interest rates. This persistently high inflation has raised questions about the possibility of the central bank lowering interest rates throughout 2024.
In fact, bitcoin and other assets like gold can serve as a hedge against inflation and economic uncertainty. However, rising interest rates tend to influence investors away from high-risk assets such as cryptocurrencies, causing their prices to decline.
bitcoin price quick view
At the time of writing, the price of bitcoin is around $66,826, reflecting a significant drop of 5% in the last 24 hours.
bitcoin price falls below $67,000 on the daily timeframe | Source: BTCUSDT chart on x/gjyWy0gD/" target="_blank" rel="noopener nofollow">TradingView
Featured image from iStock, chart from TradingView
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