[CryptoQuant: This is why Bitcoin could fall to $40,000]
Bitcoin fell more than 15% on Monday, briefly falling below $50,000, as concerns about a U.S. recession and rising geopolitical tensions in the Middle East. It was the first time it fell below this threshold since February before rebounding to around $52,000. Experts say there could be more downside for the crypto asset.
Bitcoin could fall to $40,000, which would be a tough time for investors, according to new analysis from CryptoQuant. The platform noted that traders are currently experiencing the most negative unrealized profits since November 2022. The decline reflects a significant shift in market sentiment, with selling pressure increasing amid economic uncertainty.
According to observations by IntoTheBlock, the sharp decline in Bitcoin has seen the proportion of profitable holders fall to 75%, the lowest level since January, when the price formed a local bottom around $39,000.
It’s not just Bitcoin that’s been affected by intense selling pressure. Ethereum has fallen more than 22% in the past 24 hours, dropping the price to $2,264. During the same period, Solana and XRP also fell by more than 18.2% and 16.6% respectively, with the rest of the market also falling. Meanwhile, Dogecoin is down more than 20%.
The bloodbath triggered $1.08 billion worth of crypto futures liquidations in the past 24 hours. According to data from CoinGlass, $919.62 million in long positions were liquidated, while short positions accounted for $162.45 million.
Bitcoin was hit the hardest, with over $371 million in liquidations, with $310.26 million accounted for by longs and $61.22 million by shorts. Ethereum followed, with nearly $353 million liquidated during the same period, including $303 million long and $49.6 million short. This was followed by Solana and Dogecoin, with $60.91 million and $13.14 million liquidated respectively.
A total of 283,280 traders were liquidated in the past 24 hours, with the largest liquidation order occurring on Huobi for $27 million worth of BTC-USD. The decline caused the Crypto Fear & Greed Sentiment Index to read "Fear," reaching its lowest point since early July.
