What happened?
Bitcoin is facing a potential crash to $92,000 as several key demand metrics show a significant decline. CryptoQuant’s head of research, Julio Moreno, explains that Bitcoin has entered a “soft patch” which could derail the current bull run. Demand for Bitcoin has dropped by nearly 50% over the last 30 days, causing concern among investors and analysts.
Who does this affect?
This situation primarily affects Bitcoin investors, particularly short-term holders who have already sold off a substantial amount of BTC. Institutional investors and high-net-worth individuals who previously drove Bitcoin’s rally are also impacted as they withdraw from aggressive accumulation. Retail investors who entered the market during the bull run may face significant losses if the price correction continues.
Why does this matter?
This potential downturn in Bitcoin’s price could have broader implications on the cryptocurrency market, triggering a trend of selling and further price declines. The shift from profit-taking to opening new short positions indicates a bearish sentiment among traders about Bitcoin’s near-term prospects. However, experts suggest that this correction might be a temporary hurdle in an otherwise intact bull market, offering possible long-term buying opportunities before Bitcoin resumes its upward trajectory.