While whether spot Bitcoin ETFs will be approved or not since the first days of 2024 continues to be one of the most talked about topics by investors and the market, every news affects the BTC price.
At this point, last week's Matrixport report claiming that the SEC may reject or delay spot Bitcoin ETF applications had a negative impact on the Bitcoin price.
After this report, BTC fell from $ 45,000 to $ 40,400 in a short time. With this decline, a large liquidation took place in long positions.
Evaluating this sharp decline and liquidations, Bitfinex analysts argued that this decline and liquidations were predictable and healthy.
In addition, analysts said that the decline in BTC triggered the largest liquidation wave since August 2023, with $591 million and $94 million liquidated in long and short positions.
According to analysts, the latest wave of liquidations was the third largest long position liquidation since the bear market reached its low point in November 2022.
“Bitcoin wouldn't have had it if the new year hadn't started with a bang!
BTC fell 11% on January 3, 2024. A report that the long-awaited Bitcoin spot ETFs may not be approved at all has resulted in significant liquidations of both long and short positions, as well as billions of dollars in open positions being wiped out.
While such declines and developments are always heartbreaking, we also believe they are healthy and completely predictable.
At this point, we believe the market is particularly vulnerable to pullbacks around $44,000-$45,000 and remains hypersensitive to any regulatory developments.
“In addition, we expect that in the first months of 2024, the price of Bitcoin, along with the market, will increase in volatility, may experience withdrawals, and will be vulnerable to these withdrawals, as the risk of leveraged long positions increases.”
Lastly, Bitfinex analysts stated that it is difficult to say whether there will be further pullbacks in BTC and the market and said, “We believe that these pullbacks are healthy for the market and are a result of the 'reset' of the extreme bullish trend with the funding rate.”
*This is not investment advice.
