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Bitcoin has dropped 11.25% in three days, losing nearly $12,000 and settling at $94,715. This decline triggered a $1.10 billion market liquidation, with long traders incurring significant losses. The crypto market as a whole saw its market cap drop 9.31%, now at $3.21 trillion, as 334,000 traders faced liquidation, including $929.16 million from long trades.

El Salvador’s $1.4 Billion Loan Agreement
El Salvador, the first country to adopt Bitcoin as legal tender, has struck a $1.4 billion loan deal with the IMF to stabilize its economy. However, the agreement requires the country to amend its Bitcoin policy, aligning with IMF recommendations. This policy shift is considered a major reason for the market decline.
Bitcoin Market Analysis
Bitcoin recently reached a peak of $108,364 on December 17 before falling 12.74%. Technical analysis reveals mixed signals. On the daily chart, Bitcoin's RSI stands at 44.66, indicating it hasn't reached the oversold zone. However, the 4-hour chart shows an RSI below 30, suggesting a potential rebound. Divergence between Bitcoin’s price movement and its RSI during its rise hinted at the current drop.

Market Impact and Future Outlook
Bitcoin's crash led to increased trading activity, up 13.77%, driven by short trades. Altcoins have also suffered due to Bitcoin's influence. Analysts anticipate potential recovery as whales might capitalize on discounted prices. If Bitcoin drops further, it could test support at $91,900. Traders are urged to exercise caution during such volatile periods.