The global cryptocurrency market cap dropped 5 percent in the past 24 hours to about $2.42 trillion on Tuesday. Bitcoin (BTC) and Ethereum led the wider cryptocurrency correction, dropping about 5 percent to trade around $63,277 and $3,089, respectively. Following the heightened crypto volatility, around $300 million was liquidated in the past 24 hours, mostly involving long traders.
Top Reasons Crypto and Bitcoin Prices Dropped
Bitcoin led the cryptocurrency market on a bullish outlook on Monday following a choppy weekend after Hong Kong approved the trading of spot BTC and Ether ETFs. However, senior ETF analyst for Bloomberg, Eric Balchunas, pointed out that the Hong Kong market is tiny and indicated they will be lucky to accrue $500 million in cash inflows. Furthermore, Chinese investors are not yet legally allowed to invest directly in Hong Kong ETFs.
Meanwhile, the looming crisis in the Middle East between Israel and neighboring countries has increased fear among traders. Nonetheless, the fourth Bitcoin halving is in less than five days, which will further increase the demand vs. supply shock.
Analysts Target on BTC Price Action
According to Markus Thielen, founder of 10x Research, the cryptocurrency and stock markets are teetering on the edge of a significant price correction. Nonetheless, Thielen told clients in a note that some crypto assets with high conviction will likely rebound in the near term amid anticipated interest rate cuts in the United States.
According to a Bitcoin price analysis by a popular crypto analyst, Michaël van de Poppe, the flagship coin has established a robust support level of around $61,441. However, the crypto analyst cautioned traders to look further towards $55k if the support level is breached.
Nonetheless, Poppe indicated that Bitcoin price is likely to hold on to the support level ahead of the halving and rally to a new all-time high soon.
