After more than eight weeks of attempting to rally above $31k, Bitcoin bulls have succumbed to mid-term selling pressure. According to the latest crypto market data, the price of Bitcoin dropped nearly 5 percent, hitting a monthly low of around $26,188 during the early London trading session. Similarly, Ethereum (ETH), the second most valuable digital asset by market capitalization, also experienced a five percent decline, trading at approximately $1,759 at the time of publication.
Crypto Market Cap Falls, Bitcoin Dominance Declines
Consequently, the total crypto market capitalization plummeted by about 3.3 percent, resting at around $1.14 trillion on Friday, May 12. With Bitcoin’s dominance rapidly dropping below 48 percent, as indicated by market data from TradingView, crypto traders are left contemplating whether the long-awaited altcoin season is poised to materialize.
Consider Both View Points: Bitcoin Price Prediction: BTC Price to Hit New All-Time High in 415 Days, Predicts Crypto Analyst – Coinpedia Fintech News
Increasing Volatility Expected as Global Recession Fears Rise
Given the mounting probability of a global recession amid rising inflation, experts anticipate a significant increase in crypto volatility in the forthcoming months. The United States debt ceiling debate has left the Federal Reserve torn between implementing monetary tightening policies to achieve a 2 percent inflation target. Furthermore, traditional banks are grappling with the challenges posed by the Web3 industry and other fintech companies, which have been driving recent bank runs.
Related: Can Crypto Markets Survive A Massive Recession In The USA? – Coinpedia Fintech News
Short Squeeze Looms
Over the past 24 hours, more than 82 percent of long traders in the crypto market have been liquidated, according to reports from Coinglass. Consequently, these traders are likely to shift their focus to short selling, potentially fueling a long squeeze. As a result, the crypto market may experience further decline in the coming days due to increased panic selling.
The Future Is Bullish
Renowned trader and investor @CryptoTony_ on Twitter has expressed optimism about the long-term prospects of the crypto market, suggesting a potential rebound in the third quarter of 2023.
