Bitcoin Falls Below $100,000 as Trading Activity Surges
Bitcoin's trading volume skyrocketed on Monday, rising 222% to $55.3 billion, after Arthur Hayes, CIO of Maelstrom Fund, predicted a significant price drop to $70,000 before rebounding to $250,000 by the end of the year.
Currently, Bitcoin is trading just above $99,000, an 8.67% drop from its all-time high of $108,000 on January 20, according to CoinGecko.
In the past 24 hours, the crypto derivatives market saw $850 million in liquidations, with most losses coming from long positions, Coinglass data reveals. Hayes warns of a possible "mini financial crisis" that could trigger the correction, citing concerns over U.S. tech dominance and the potential for more money printing.
Market Pressures and Profit-Taking
Data from Bloomberg shows that profit-taking has contributed to recent sell-offs. Coordinated selling around Bitcoin's January 20 peak of $108,786 and concentrated sell pressure between $104,000 and $108,000 caused Bitcoin's price to drop 8.2% in a week, surpassing the overall crypto market's 5.5% decline.
Trading volume surged to $55.3 billion, suggesting major position changes. Additionally, Bitcoin mining difficulty dropped by 2% for the first time since September 2024, according to CloverPool data. This shift indicates reduced computational power on the network, reflecting miners' adjustments to declining profitability.
Short-Term Challenges, Long-Term Optimism
The broader crypto market is also under pressure, with Bitcoin underperforming other assets. While the global crypto market fell 5.5% over the past week, Bitcoin's 8.2% decline highlights heightened selling pressure.
Despite these challenges, Hayes remains optimistic, predicting that monetary easing could push Bitcoin to $250,000 by year-end. Bitcoin's market capitalization currently stands at $1.97 trillion, maintaining its status as the largest digital asset.
In short, while Bitcoin faces short-term setbacks, analysts believe it may still have room for significant growth in the coming months.
