The cryptocurrency market, led by Bitcoin, has shown sharp volatility following liquidations that ended in a sharp price correction. The sudden fluctuations have left investors and analysts debating whether Bitcoin has reached the top of the market. When writing, BTC traded at $72,840 (+1.15% in 24 hours).
Indeed, recent events have sparked serious debate, especially in light of comments from prominent financial analysts and the massive liquidation of positions on major trading platforms.
On March 5, bitcoin broke an all-time high, crossing the $69,000 mark. The price briefly beat the previous all-time high set in November 2021. The new all-time high didn’t last long, as the price declined slightly. On the same day, bitcoin experienced a sharp drop, with the price dropping to $59,200.
This sharp drop, caused by the liquidation of long leveraged positions, led to the liquidation of more than $1 billion worth of positions, with about 296,908 traders affected. According to CoinGlass, this amounted to about $892 million for long positions and about $291 million for short positions.
Bitcoin’s current rally comes on the back of a recent dip below the $69,000 mark on March 12, when the cryptocurrency briefly dipped to around $68,600. Despite the setback, bitcoin seems to be recovering, with long-only traders expecting further positive moves.
Such significant market movement has sparked discussions about bitcoin’s stability and future prospects. Crypto analyst Miles Deutscher called the event “the largest liquidation of cryptocurrencies in the last six months,” emphasizing its role as a “much-needed leverage reset” for an overheated market.
Some experts believe bitcoin has reached a new ATH thanks to the adoption of ETFs. After all, just two months after the approval and launch of ten spot bitcoin ETF funds, such a “jump” happened. Seth Ginns, managing partner and head of liquid investments at CoinFund, believes that a new all-time high would have been reached without ETFs, but it is likely that this cycle was accelerated by ETF flows.
