TL;DR
- Bitcoin hits all-time high of $69,000 before falling to $59,000, sparking $1B market selloff.
- More than 80% of the liquidation is due to long positions in Bitcoin, generating losses for leveraged investors.
- Bitcoin quickly recovers to $67,000 during the Asian session, demonstrating resilience in the cryptocurrency market.
The cryptocurrency market experienced a day of intense volatility on March 5, with Bitcoin (BTC) taking center stage.
The leading cryptocurrency briefly hit an all-time high of around $69,000 before falling sharply to $59,000 within hours, triggering a sell-off of around $1 billion in the market.
More than 80% of this liquidation came from long positions in Bitcoin, resulting in significant losses for investors with leveraged positions.
Not only Bitcoin was affected by this price movement, but other cryptocurrencies also suffered significant declines.
Dogecoin (DOGE) and Shiba Inu (SHIB) saw drops of 30% and over 40% respectively.
Profit taking after Bitcoin hit its all-time high and selling of bitcoins by miners were cited as the main reasons behind this steep drop.
Data from CoinGlass revealed a significant increase in miners bitcoin outflow in the days leading up to the price drop, suggesting they were selling their holdings on exchanges.
However, the market quickly recovered on March 6, with Bitcoin reclaiming the $67,000 level
Ethereum (ETH) also saw a 7% rise topping $3,800, indicating a widespread recovery in the cryptocurrency market.
As for meme cryptocurrencies, some saw a significant recovery.
Dogwifhat (WIF) and PEPE recorded increases of 35% and 25% respectively, while SHIB and DOGE also showed signs of recovery with increases of 5% and 10% respectively on the daily charts.
Analysts are divided on Bitcoin’s future prospects.
Some believe the price will rise due to the current supply shortage and the upcoming halving event in April, while others warn of continued cryptocurrency market volatility.
However, uncertainty appears to persist in the market, with investors closely watching price movements and market trends to make informed decisions about their cryptocurrency investments.
