The price of Bitcoin (BTC) briefly fell to $57,874 on July 4, the first time the asset has fallen below $58,000 in over two months. This drop was due in part to the liquidation of long positions in Bitcoin futures, with over $64.2 million in long BTC positions liquidated in the last 24 hours.
Other major cryptocurrencies and altcoins also saw significant declines, with Ether (ETH) down 4.5% on the day and Binance Coin (BNB) down 6%. Solana (SOL) has also erased much of its recent gains, falling 10.3% over the past 24 hours.
Reasons for the drop in Bitcoin’s price
Several factors explain this drop in the price of Bitcoin:
- The liquidation of long positions in Bitcoin futures, with over $64.2 million in long positions liquidated in 24 hours.
- Anticipation of repayments to Mt. Gox creditors, which could inject up to 142,000 BTC into the market
- Macroeconomic factors such as inflation and US Federal Reserve interest rates, which influence investors’ preference for risky assets such as cryptocurrencies
- Whale activity, with multi-million dollar transactions amplifying the drop in prices
The impact on the cryptocurrency market
This fall in the price of Bitcoin resulted in significant losses for leveraged traders, with over $142 million in long positions liquidated in one hour. The cryptocurrency market as a whole is in decline, with Bitcoin the most affected asset.
