With only four days left until the end of August, the cryptocurrency industry has witnessed a rapid decline in the price of Bitcoin (BTC), which has crashed below the psychological level of $60,000, and crypto traders and investors are curious about the factors behind the sudden drop.
Indeed, Bitcoin has accumulated a dip of over 10% in the last 30 days, its current price crowning last week’s volatility in the crypto market, during which the prices of many other crypto assets were rising and nosediving indiscriminately, raising concerns among crypto investors.
Bitcoin price analysis
Specifically, Bitcoin is currently changing hands at the price of $59,530, which suggests a 3.99% decline in the last 24 hours, a modest recovery of 0.50% across the previous seven days, while losing 14.04% in the past month, according to the most recent chart data retrieved on August 28.
Bitcoin price 30-day chart. Source: Finbold
Why is Bitcoin crashing?
Notably, one reason for the massive dump could be significant whale sell-offs, as demonstrated by one whale who had moved 2,300 BTC worth $142.24 million to Kraken, a renowned crypto exchange, as recorded by the crypto transaction tracking platform Arkham Intelligence.
Whale’s Bitcoin transaction. Source: Arkham Intelligence
In fact, sending a large amount of a crypto asset to centralized exchanges often happens with the goal of selling it, triggering a bearish sentiment as other holders follow suit, and, considering the above whale still has 18,141 BTC worth $1.08 billion in their possession, getting rid of it could add to the downtrend.
At the same time, Bitcoin has faced a wave of large liquidations stemming from the embattled crypto trading platform Celsius’s repayment of close to $2.5 billion to its 251,000 creditors since the plan kicked off in January 2024, a recent court filing reveals.
Specifically, the filing to the Delaware bankruptcy court points out that:
“Since the Effective Date, the Post-Effective Date Debtors have successfully made initial distributions to approximately 251,000 creditors – roughly two-thirds of all eligible creditors by number and approximately 93% of the eligible value.”
In response, the crypto market reacted with nearly $335 million in liquidations of leveraged crypto derivatives positions in the timeframe of just 24 hours, the largest since the August 5 crash, as per the latest data by aggregated derivative exchange data platform CoinGlass.
Leveraged crypto derivatives positions liquidations. Source: CoinGlass
On the other hand, Steven Lubka, head of private clients and family offices at Swan Bitcoin, the financial services provider focusing solely on the largest asset in the crypto sector by market capitalization, believes this could be a great ‘buy the dip’ opportunity for Bitcoin, telling CNBC that:
“Leverage-driven flushes typically are great buying opportunities. (…) And while I expect markets to buy the dip on Bitcoin, Ethereum (ETH) may continue to struggle until investors have a reason to be positive on the asset again.”
BTC consolidation = imminent recovery?
Meanwhile, as Bitcoin continues consolidating in a nearly six-month price range that is getting tighter, a breakout might be imminent as the range acts like the ‘handle’ to a three-year ‘cup’ chart pattern, as recently stressed by pseudonymous crypto market analyst MetaShackle.
BTC 3-year cup & handle pattern. Source: MetaShackle
Furthermore, a bullish analysis also comes from another pseudonymous crypto expert, TradingShot, who has recently highlighted that the end of August could be pivotal in pushing Bitcoin to reach the high price mark of $100,000, considering its remarkable resilience.
Disclaimer: The content on this site should not be considered investment advice. Investing is speculative. When investing, your capital is at risk.
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