Key Points
- Bitcoin’s unexpected drop from $69K to $66K triggered $250M in market liquidations.
- Peter Schiff mocked Bitcoin’s instability but expressed sympathy for U.S. investors unable to act until NYSE opened.
Bitcoin [BTC] experienced a sudden bearish reaction during Asian trading hours on April 2nd. The cryptocurrency saw a $3K drop, falling from $69K to $66K, following an unexpected improvement in US manufacturing activity in March.
At the time of this report, over 95% of interest rate traders anticipated the Federal Reserve to keep its current rate range in May. This implies that the chances of rate cuts by summer could decrease substantially, potentially impacting risk-on assets like Bitcoin.
Schiff’s Take on Bitcoin’s Slump
In the midst of this downturn, Peter Schiff made a jab at Bitcoin, equating its drop to a $100 fall in the price of gold in 10 minutes. However, Schiff also expressed sympathy for investors who were unable to react until the New York Stock Exchange resumed trading.
The robust US manufacturing data for March led Bloomberg analysts to reduce the likelihood of June Federal Reserve rate cuts to below 50%. Quinn Thompson, CIO of Lekker Capital’s on-chain derivatives platform, saw this as an “unexpected macro risk.” He had anticipated a strong Bitcoin move in the first two weeks of April, but this macro risk forced him to reconsider his timeline.
Impact of Bitcoin’s Slump
Bitcoin’s drastic drop to $66K resulted in over $250M in liquidations in the market within the past 12 hours. For Bitcoin, the total rekt positions accounted for $95M, with longs suffering $64M in liquidations in the same timeframe.
Crypto research firm 10X Research highlighted that $68.3K was a crucial point for Bitcoin. However, a breach below the February-April trendline support could give bears more leverage.
