Bitcoin dropped $ 1,450 in five minutes. The reason behind the sharp decline in the price of the cryptocurrency.

By lioha369 | 1minRead | 3 Aug 2020


Bitcoin is entering a new business week at around $ 11,200. This is a slight difference from the previous seven days, but the crypto world is actively discussing what happened the day before, on Sunday, August 2. The fact is that the cryptocurrency was able to grow to the level of $ 12000, and then within five minutes, it collapsed by $ 1450, to the level of $ 10,550. Despite the fact that Bitcoin eventually grew in price again, such a “roller coaster” did not leave traders indifferent, given that some of them could not only make money on it but also lose.


What happened?
It turned out that the reason for the price drop was the fact that about 72 thousand short contracts were carried out in these five minutes, as a result, Bitcoin was sold in the amount of about one billion dollars. Moreover, it is very important that for the most part, such sales were of a “paper” nature, meaning that they were carried out under contracts with high leverage. Analysts believe that "whales", that is, some owners of large fortunes in Bitcoin, could be behind such an operation.

The price of Ethereum also fell into the circle of volatility: on Sunday, August 2, it rose to $ 416.5 and then tested the “bottom” at the level of $ 295. As a result, at the beginning of the week, Ethereum as well as Bitcoin was able to make up some of the losses and entered on August 3 at the level of $ 369.

It is worth noting that a similar release of Bitcoin to the market happened on March 13. At that time, crypto coins worth about one billion dollars were also sold. In March, the cryptocurrency went to a level around $ 3,500, and this time Bitcoin, firstly, fell much less, and secondly, it was able to compensate for a significant part of the losses in just a few hours. This allows us to agree with analyst Max Kaiser that the cryptocurrency market in general, and Bitcoin mainly, continues to be in a bullish phase. And this may mean that potentially crypto-coin # 1 can reach 20 thousand dollars in the foreseeable future.


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Crypto enthusiast. Not an advisor. Sharing my thoughts.


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