Bitcoin (BTC) and the broader crypto market went into a sharp selloff over the past day, led lower by a de-pegging of the partially BTC-backed stablecoin terraUSD (UST) and a falling risk sentiment globally.
The selling led to massive liquidations of leveraged bitcoin long positions across exchanges, with about USD 193m liquidated in the 12 hours from noon to midnight UTC time on Monday. The liquidations in crypto came as stocks globally also went into deep red territory, with the US S&P 500 index losing 3.2% on Monday and the technology-heavy Nasdaq index shedding 4.3%.
The selling has brought the so-called Crypto Fear and Greed Index, which measures sentiment from across the crypto market, to ‘Extreme Fear’ with a reading of 10.
Joe DiPasquale, CEO of crypto hedge fund manager BitBullCapital, said in an emailed commentary that,
“Moving forward, more downside can be expected, especially as monetary policy continues to contract but we don't expect BTC to lose the zone between 25k - 30k even in the event of an extreme downturn.”
Similarly, Mike Novogratz, the founder and CEO of Galaxy Digital, said during an earnings call for his company on Monday that he believes “there’s some more damage to be done.” Nevertheless, he reiterated that BTC could hold at the USD 30,000 range and ETH at the USD 2,000 level.
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