Beijing Chain News:
Bitcoin falls below $60,000 due to ETF outflows and options expiration triggering market liquidation. Analyst Ali Martinez warns that if Bitcoin rebounds to $62,600, there may be a liquidation of $1 billion.
Bitcoin (BTC) has once again fallen, with the cryptocurrency dropping below $60,000 on the price chart. This means a 4% decrease in just 24 hours. In fact, this devaluation marks Bitcoin as the most affected cryptocurrency in the entire market slump.
This decline comes as the cryptocurrency market has fallen by over 4% in the past 24 hours, affecting major assets such as Bitcoin, Ethereum, DOGE, BNB, and LINK.
However, it is worth noting that as of the time of writing, the fear and greed index is only at 48, indicating a neutral sentiment among market participants. In simple terms, investors are neither excessively fearful nor greedy at the moment, but uncertainty is still widespread.
This is especially the case given the expected repayment of creditors by Mt. Gox this month. With over $9 billion worth of BTC owed to over 127,000 creditors, many of whom will seek to profit from unrealized gains, it is an invitation to sell pressure.
Bitcoin ETF outflows and investor concerns
The outflow of funds from the U.S. spot Bitcoin ETF has made a significant contribution to the current market situation. After five consecutive days of inflows totaling $129.5 million as of July 1, this trend has reversed, with an outflow of $13.7 million on July 2.
The Belad IBIT and Fuda FBTC saw inflows of $14.1 million and $5.4 million, respectively. However, the significant outflow of $32.4 million from GrayScale company has mitigated those gains. Therefore, this shift in the ETF trend has caused concern among investors about the price trend of Bitcoin.
Meanwhile, the expiration of a large number of Bitcoin and Ethereum options is also exacerbating market volatility. In fact, data from Deribit shows that over $1.04 billion worth of BTC options with a put/call ratio of 0.80 are set to expire on Friday, July 5.
The maximum pain price for these options is $63,000, indicating a key threshold that could potentially affect investor behavior and market dynamics. Therefore, the expected expiration has led to cautious trading, increasing uncertainty among market participants.
Liquidation exacerbates market sell-off
According to CoinGlass data, the recent sell-off has triggered over $260 million in liquidations in just 24 hours. During this period, over 100,000 traders were liquidated, with the largest liquidation involving ETH-USDT-SWAP on OKX.
Bitcoin faced a total of $67 million in liquidations, while Ethereum’s liquidation amount was $63 million.
However, despite the current economic downturn, some analysts remain optimistic about the market’s future. They expect potential gains associated with upcoming regulatory decisions.
That being said, analyst Ali Martinez has issued a warning about the possibility of further liquidation. According to him, if Bitcoin were to rebound to $62,600 again, the market could see over $1 billion in liquidation.
Ethereum ETF launch delayed
Finally, the delayed launch of the spot Ethereum ETF has further exacerbated the current pessimistic sentiment in the market. The U.S. Securities and Exchange Commission has set a new deadline of July 8 for the submitted forms, delaying the expected approval process.
The community has not been satisfied with this, and Nate Geraci, President of ETF Store, has expressed disappointment with this lengthy process. Many are now hoping that once these ETFs go live, BTC and other parts of the cryptocurrency market will continue the bull market.