In this episode of the BeInCrypto video news show, host Jessica Walker will discuss Bitcoin (BTC) reaching $60,000, including what pushed it back down, and what may have helped it reach the new all-time high.
Bitcoin Whales Selloff
One reason for the drop in BTC’s price on Monday, March 15, could have been a large whales selloff. When the price began to drop, the futures market was one source of information. It indicated that the majority of the market was longing, or buying, BTC. This made the market ripe for shorting, which instigated selling pressure.
Some 194,541 traders were liquidated within 24 hours, according to data from Bybt. This amounted to roughly $1.83 billion, the highest amount liquidated since Feb 21. Because of the overheated market, the futures markets saw a cascade of liquidations. This led to BTC falling below $55,000.
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Notably, before the drop happened, on-chain data analytics platform CryptoQuant highlighted large BTC deposits into Gemini. Gemini is a leading American Bitcoin exchange. It is popularly known as a “whale exchange.” CEO Tyler Winklevoss said 18,000 BTC had entered the exchange totaling over $1 billion.
The combination of selling pressure from whales and the high futures funding rate likely contributed to the pullback.
Impact of Stimulus Checks
Despite BTC’s fall, many are also speculating what could have contributed to its boost to $60,000. Many think that the prospect of stimulus checks likely played a role. On March 6, the US House of Representatives approved President Joe Biden’s $1.9 trillion stimulus package.
The package includes $1,400 checks for each taxpaying American citizen. Similar stimulus checks last year were thought to have contributed to the boom in the crypto markets.
However, to fund this massive stimulus, the US Federal Reserve has had to print a great deal of additional money. This has sent inflation rates soaring, and last year, many investors sought out BTC as a more appreciating asset. Ironically, those benefiting from the inflation-fueled stimulus may also feel that way and harbor their money in crypto.