Bitcoin Crash Before The Halving – 1B Liquidated

April 13, 2024

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Bitcoin(BTC) took a sharp tumble just a few days before the halving event. Crashing over 6% to hit $65,000, triggering a broader 7.8% correction across the cryptocurrency market. Altcoins didn’t escape unscathed either, with the top ten seeing corrections ranging from 8-15%.

Halving Dip

As the Bitcoin price took experienced a halving dip, around $1 Billion in bullish crypto bets got liquidated in the past 24 hours, marking the most significant drop in a month, according to Coinglass data. This financial shake-up happened amidst escalating geopolitical tensions, pushing investors toward traditional safe havens like bonds and the dollar.

The turbulence wasn’t limited to crypto alone; the S&P500 and gold prices retraced alongside, suggesting investors are grappling with CPI and inflation worries, with chances of a Fed interest rate cut dwindling.

In derivative markets, there are growing jitters among traders, particularly ahead of a Bitcoin halving, historically seen as bullish. Implied volatility for Bitcoin options surged recently, indicating reduced confidence among market players regarding price direction. This uptick often prompts traders to pay more to hedge existing positions or speculate on potential price swings.

Bitcoin’s volatility spiked further amidst global financial market turmoil fueled by geopolitical risks. Implied volatility for near-term contracts soared from 59% to 71% in just two days, indicating a growing anticipation of short-term price swings.

some explanation could be that it’s likely more bearish as traders are uncertain, but are willing to pay more for options to get protection against price swings. They’re possibly paying high premiums to buy downward protection.

Meanwhile, the altcoin market also witnessed significant corrections. Ether, Solana, Dogecoin, Cardano, and Polkadot all saw substantial declines, with losses ranging from 12% to 15%.

Final Words

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You might also like our recent trading blogs about Ethereum’s Price Action, and Solana meme coin trading bot.

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