The crypto market is having a tumultuous day, with Bitcoin dropping below $67,000 and leading to the liquidation of over 75,000 traders as investors take a defensive stance in the face of macroeconomic uncertainties.
Intense downward pressure on Bitcoin and massive liquidations
This Tuesday, June 11, the Bitcoin plunged to a low of $66,050, marking a drop of more than 3% over 24 hours. This tumble triggered the liquidation of $170.25 million in positions long derivative positions, including $50.87 million in long Bitcoin positions.
In total, no fewer than 75,247 traders suffered total liquidation of their positions, incurring heavy losses in the midst of a dazzling bear market.
This debacle underlines investors’ nervousness in the face of economic and geopolitical headwinds. According to QCP Capital, a crypto analysis company, several factors are weighing heavily on the crypto market.
On the one hand, better-than-expected U.S. jobs data has rekindled fears of more aggressive monetary tightening by the Federal Reserve. This prospect pushed up bond yields, calling into question expectations of rate cuts for July and September.
On the other hand, French President Emmanuel Macron’s call for early elections has exacerbated geopolitical uncertainty in Europe, weakening the euro against the dollar and fanning investors’ risk aversion.
Major challenges ahead for the crypto market?
QCP Capital underlines that the market remains cautious ahead of the upcoming US inflation figures and the meeting of the FOMC MEETING, which should provide guidance on the path of interest rates to 2024.
In addition, the massive outflows from Bitcoin exchange-traded funds, to the tune of $64 million on Monday, underscore the current fragility of market sentiment.
Although Bitcoin has demonstrated remarkable resilience in recent months, macroeconomic and geopolitical headwinds threaten to slow its bullish momentum. The next few weeks will be crucial in determining whether this correction is just a temporary blip or the start of a more pronounced consolidation phase on the crypto market.
As a journalist at Coinpri, I’ve been captivated by the world of bitcoin and blockchain since 2020. The decentralized aspect of Bitcoin particularly piqued my interest. Since then, I’ve been working constantly to spread my knowledge, hoping one day to see a world where everyone fully enjoys their financial freedom.
