Bitcoin suddenly experienced a flash crash, with its price once falling to $58,000. What was the reason behind it?

Last night, both Bitcoin and Ethereum experienced a significant decline, with Bitcoin once falling by more than 7%, and Ethereum falling by more than 10%. The market fell into panic, and a total of 85,678 investors were liquidated within 24 hours, with total losses as high as US$315 million.

What happened?

Despite the inflow of funds into U.S. exchanges, the price of Bitcoin has fallen sharply. The market is worried that the US government may sell seized Bitcoins, but apart from this concern, there is no other significant negative news.

In terms of liquidity, although the Federal Reserve hinted that it may cut interest rates, there have been changes in the money market, with the scale of overnight reverse repurchases increasing and SOFR (Secured Overnight Financing Rate) also picking up.

From the perspective of market structure, Ethereum may be one of the main causes of this turmoil. Since July, the Ethereum ETF has experienced continuous net outflows, totaling nearly $112 million. At the same time, the supply of Ethereum has increased, and Layer 2 (L2) solutions have begun to divert transaction volume from the Ethereum mainnet, further exacerbating market uneasiness.

On the supply side, market sentiment has been further pressured by concerns over the potential sale of seized Bitcoin by the U.S. government, following a previous transfer of nearly $2 billion worth of Bitcoin from government wallets.

Finally, the decline in the market value of USDT, the world's largest stable currency, has also limited the rebound of Bitcoin prices. Liquidity is critical to the market, but current market conditions do not yet support significant gains. #加密市场急跌 #Telegram创始人被捕 #以太坊基金会 #美联储何时降息？