The price of Bitcoin (BTC) experienced a sudden and significant drop in the early hours of Dec. 11, falling below $41,000 to as low as $40,659 in just 20 minutes. This represents a 6.5% drawdown from its previous level of $43,357. This decline also caused more than $270 million worth of long positions to be liquidated, according to data from CoinGlass.
At the time of publication, Bitcoin had bounced back slightly and was trading just below $42,000, hovering at around $41,960 per TradingView data. The drawdown is the largest single-day decline for Bitcoin in over a month, despite the asset experiencing a 12% growth over the past 30 days.
The sudden drop also impacted other major cryptocurrencies, with Ether (ETH) falling more than 8.9% and other large-cap assets like Binance Coin (BNB), Ripple (XRP), and Solana (SOL) also posting losses. The price of ETH stabilized at $2,233, down 5.3% on the day.
The drawdown occurred shortly after the Wolf of All Street’s Scott Melker pointed out that Bitcoin had just closed its 8th consecutive weekly green candle. This comment was accompanied by the tongue-in-cheek inquiry, “When correction, sir?”
Despite the recent drop, Bitcoin has risen more than 150% since the beginning of the year, primarily driven by expectations of the United States SEC approving spot Bitcoin exchange-traded funds (ETF). Additionally, the market is anticipating the Federal Reserve to begin cutting interest rates next year, further boosting Bitcoin’s rally.
Investors are also preparing for upcoming inflation data and the final FOMC meeting of the year. Analysts are expecting improvements in core inflation and predicting that the Federal Reserve will maintain its current interest rates.
As the crypto market continues to experience volatility, investors and analysts remain focused on regulatory decisions, macroeconomic factors, and market sentiment to guide their strategies and predictions for the future.