On Friday (December 27), Bitcoin plummeted and nearly fell below $95,000, recording a drop of over $2,000 in a single day. The collapse was caused by a 'reporting error' on Trading View that showed Bitcoin's dominance in the market dropping to 0%. Strive, associated with the elected President Trump, applied for a Bitcoin bond ETF aimed at investing in convertible bonds from Wall Street-listed giant MicroStrategy, among others.
Users in the cryptocurrency community reported anomalies in the Trading View Bitcoin dominance chart as Bitcoin fell to $95,000. The error indicated that Bitcoin's share of the total cryptocurrency market cap had dropped to 0%. This error is said to be the underlying reason for subconscious trading reactions, which have now been corrected.
Data from monitoring resource CoinGlass shows that approximately $33 million in Bitcoin longs are currently being liquidated.
Forbes reports that AltAlpha Digital co-founder Marc P. Bernegger stated: "The recent fluctuations in Bitcoin's price, dropping from nearly $100,000 to around $95,000, seem to be influenced by the Trading View malfunction."
"This error incorrectly displayed Bitcoin's dominance as 0%, causing panic among traders, followed by market turmoil. This led to significant liquidations, with approximately $33 million in Bitcoin longs being liquidated within a few hours," he added.
He stated: "There was also an untimely malfunction on Trading View that caused Bitcoin's dominance indicator to drop to 0%, which may have triggered additional fund outflows. Therefore, the panic selling caused by the low liquidity environment due to a technical error, coupled with strategic profit-taking after a relatively positive year, as well as significant institutional changes with $338 million in Bitcoin ETF outflows the day before Christmas, are likely to be the catalysts for Bitcoin's price drop in the past 24 hours."
Despite the thin trading ending on Christmas, traders remain cautious ahead of Trump's inauguration on January 20, 2025. CoinTelegraph reports that Strive is an asset management company founded by billionaire Vivek Ramaswamy, which has applied to U.S. regulators to list an exchange-traded fund (ETF) that will invest in Bitcoin convertible bonds issued by MicroStrategy and other companies.
Vivek is the head of the newly established Department of Government Efficiency (DOGE) by Trump. According to documents, the Bitcoin bond ETF applied for by Strive seeks to provide investment opportunities in 'Bitcoin bonds'.
Strive stated that the Strive Bitcoin bond ETF will be actively managed and will invest directly or through financial derivatives such as swaps and options in 'Bitcoin bonds'.
Strive has not specified the management fees charged to investors, but actively managed funds typically charge more than passive index funds.
Since 2020, MicroStrategy has spent about $27 billion to purchase Bitcoin, part of a corporate finance strategy led by co-founder Michael Saylor. Its stock MSTR has risen over 2200% to date, outperforming almost all large listed companies except Nvidia.
MicroStrategy funds these acquisitions through issuing new shares and convertible bonds, with very low or no interest on the bonds that can be converted into MSTR stock under specific conditions, and other companies are following suit. According to BitcoinTreasuries.net, corporate treasuries currently hold Bitcoin worth about $56 billion.
Vivek is a vocal ally of Trump, having founded Strive in 2022. The asset management company aims to help investors 'leverage the power of capitalism'.
Since winning the U.S. presidential election on November 5, Trump has proposed appointing leaders who support the crypto industry to major regulatory agencies. In December, Trump announced the appointment of former PayPal COO David Sacks as his 'AI and cryptocurrency czar' and appointed former commissioner Paul Atkins as Chairman of the U.S. Securities and Exchange Commission.
Bitcoin Technical Analysis
Economies.com states that Bitcoin's price experienced a bearish rebound after hitting the resistance line of a corrective bearish channel appearing on the chart, beginning to suppress the 23.6% Fibonacci retracement level, which forms a key support level at $95,195.
The price needs to break through this level to confirm an upward trend to a negative target that starts at $91,000 and extends to the 38.2% Fibonacci retracement level of $87,055.
Therefore, it is recommended to take a bearish bias in the upcoming trades, considering that breaking through $99,170 would prevent the anticipated decline and lead to a price attempt to restore the main bullish trend.
