Bitcoin's price experienced a significant drop, falling below the $40,000 mark for the first time since December 3, 2023. This abrupt decline brought Bitcoin to a six-week low of $39,450, according to data from CoinMarketCap, marking a decrease of more than 4.3% in the last 24 hours and 9.3% over the last month.
Analysts attribute this downturn to the ongoing GBTC-linked selling of BTC at Coinbase, which has been negatively impacting investor sentiment throughout the crypto market. The situation was exacerbated by Grayscale depositing over $600 million worth of BTC on Coinbase on January 22, increasing the total to over $2 billion. Additionally, the bankruptcy managers at FTX sold their entire 22 million shareholding of GBTC, equivalent to nearly $1 billion, further contributing to the downward pressure on prices.
This price performance comes amid the unexpected approval of 11 spot Bitcoin ETF products in the U.S. by the Securities and Exchange Commission. The market reacted to the GBTC selling, which was blamed for the crash. These developments have led to significant long-position liquidations for Bitcoin, with over $56 million liquidated on the day and the tally still increasing.
Despite this setback, Bitcoin has shown some recovery, currently trading at $40,245. This volatility reflects the dynamic and unpredictable nature of the cryptocurrency market, and analysts are closely monitoring the situation to determine the potential future movements of Bitcoin.
Disclaimer: Please note that the information provided in this article is based on the referenced research articles. It is essential to conduct further research and analysis before making any investment decisions. The cryptocurrency market is highly volatile, and investors should exercise caution and consult with financial professionals before engaging in cryptocurrency trading or investment activities.