Following a rally to +$45K, Bitcoin fell sharply to as low as $40550 within hours on January 3, 2024 which was also commemorated as its 15th anniversary. The parabolic downslide wiped off most of the gains from the recent rally as more than $500 million long positions liquidated from crypto market. Traders went gasping as to the crash seemed against the run of play. Actually it wasn't. It was always on the cards as such the nature of Bitcoin. However what transpired Bitcoin's first fall of 2024, take a look at the posible reasons.
🔗Matrixport Report❓
In case you don't know, Matrixport is a Singapore based crypto investment services provider. It also channels a crypto news blog that has been reputed for providing near to exact insights or projections for crypto markets.
On January 2nd, Matrixport published a report suggesting that the SEC would potentially reject Bitcoin ETF applications in January.
From a political perspective, there is no reason to approve a Bitcoin Spot ETF that would legitimize Bitcoin as an alternative store of value. - Extract from Matrixport Report
The report significantly observed that Gensler isn't at all ready to hand over a straight approval for Bitcoin ETFs as he still thinks that crypto needs more "stringent compliance".
The report also highlighted that Bitcoin may see a sharp decline of 20% after the ETF applications get rejected.
While the report definitely had a say on Bitcoin's slump to $40k levels, many analysts were skeptical of the report as it clearly lacks evidence to support the claims.
Furthermore, Matrixport seems to be in a dilemma of its own. First they published a report suggesting that Bitcoin ETFs are imminent and Bitcoin is sure to go past 50k. After a few hours they published another news suggesting a possible rejection of ETFs.
After the report is being criticised severely, Jihan Wu, the co-founder of Matrixport, shamelessly praised his company's analyst for publishing two contradictory opinions on the same day. FYI, Jihan Wu was the lead conspirator in the failed and famous 51% attack on Bitcoin.
How does that look now? Can you really find any meaning to what context he was talking. If you are missing something, this isn't the real reason for the dump yesterday as Matrixport invalidates Matrixport and it becomes like a "zero information provider now."
🔗A Routine Correction❓
Bitcoin is on its way up and up from $25k to +45k in 4 months. Isn't it enough growth to digest a few single digit corrections on regular intervals? It sure is and considering that it was more than due of a major correction while it rocketed to $45879 from $41915 in 3 days. As it goes with Bitcoin, "a highly volatile asset", why are we even winking to a 10% downslide? It's more like customary.
More so because this isn't anything new for Bitcoin. Even we had Bitcoin hung inversely on numerous occasions while we were moving upwards from the depths of bear market. The most recent example of the same situation came on Dec 11, 2013 when Bitcoin sharply declined 8.2% within hours. It went like nothing happened as "Bitcoin is volatile so everything's fine."
Additionally, if you like the green candlesticks, be prepared to like a few red ones as well. If you can just notice we had a rally in Bitcoin's price (prior to 8.2% decline) where it shot up from $37700 to $44700 within 5 days. All green for five days consecutively and it brought nearly a 20% rise in prices.
So what actually happened on the above scenario was that Bitcoin just treaded in the overbought territory where buying seemed like exhausted and Bitcoin needed a correction.
🔗 A Mix of Matrixport And Correction Both❓
This is very diplomatic if we are to consider both for the recent Slump in Bitcoin. However it seemed like the 'matrixport report' was plotted with the correction after a big rally. As Jihan Wu mentioned that the report was only for "its clients" and he had no control if it went public. It is highly possible that a few loose hands even lost their heads and believed on a firm that's is thousands of miles away from NY or Washington got the insider information from regulators sitting in the U.S. Yes, if not all at least a little credit must go to Matrixport or to silly heads who believe everything they read.
🔗Who's The Winner❓
The odds are more inclined towards an essential correction, however a slight panic due to the Matrixport plot took the plunge even deeper. So it's like a mix of both, mostly a correction and slightly a head buster from ding dong people who only join crypto to get scared and commit suicide (I mean what a suicidal move as Bitcoin recovered rapidly back to $42k and now at $44k within hours).
And for those who plotted this trash collapse are also feeling sad as they weren't as successful as they anticipated. The opportunists want Bitcoin to be at $25k again and the HODLers successfully one sidedly won this battle.
At last a few wisdom words. Much like all of us, Bitcoin do inhales and exhales. These corrections and those pumps, both are necessary to form Bitcoin's breath, ultimately invoking life into it.
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