The recent Bitcoin price drop below $59K has increased overall fear of further crypto capitulation despite heightened calls for buy-the-dip.
Bitcoin (BTC) price continued with the recent bearish trend after losing the support level of around $60K in the past 24 hours. The flagship coin dropped approximately 4 percent in the past 24 hours to trade at about $58,453 on Thursday during the early European session.
As a result, more than $275 million has been rekt in the crypto leveraged markets, with around $245 million involving long traders.
Top Reasons Bitcoin Price Is Melting
Bitcoin price has suffered bearish sentiments in the past four weeks amid low optimism from whale and institutional investors. The crypto industry has been anticipating the distribution of Bitcoins worth $9 billion from Mt.Gox, which most analysts believe is bearish for the industry.
According to om-chain data provided by Spot On Chain, a crypto whale thought to be an institutional investor has deposited more than 3,500 Bitcoins to Binance crypto exchange on Thursday.
The demand for Bitcoin below the $60k level is expected to remain weak as more investors await the markets to cool down. Moreover, the best time to buy the Bitcoin dip is when the crowd is getting impatient and skeptical of the market rebound.
As Coinspeaker explained, Bitcoin price has turned bearish in the midterm fueled by notable cash outflows from spot BTC ETFs. According to the latest market data, the US spot Bitcoin ETFs registered a net cash outflow of about $20 million on Wednesday led by Grayscale’s GBTC. Notably, only Fidelity’s FBTC registered a positive cash flow of about $7 million, while the rest did not have a cash flow on Wednesday.
The cryptocurrency market turned bearish after the Federal Reserve officials at their June meeting indicated that the inflation is cooling down slowly, thus not guaranteeing interest rate cuts.
Meanwhile, the continued attacks on Web3 firms by the US SEC amid the anticipated listing of spot Ether ETFs has weighed heavily bullish sentiments.
What Next for BTC Price Action
Bitcoin price has been in a re-accumulation zone following the halving and spot BTC ETF hype that attracted more new customers. According to on-chain data from IntoTheBlock, more than 16 percent of Bitcoin holders were left in loss positions after the BTC price dropped below the crucial support level of around $60K.
As a result, more bearish pressure could push BTC price towards the next significant demand zone between $40K and $50K.
Nonetheless, on-chain data analysis provided by CryptoQuant shows that the anticipated Bitcoin price rebound is on the horizon. The firm noted that Bitcoin miner capitulation levels are around the end of 2022 during the FTX debacle. Unless Bitcoin price rebounds in the next two weeks, further crypto capitulation will be registered in the coming months before the inevitable parabolic rally.
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