Bitcoin and its sharp declines are the buzz of the globe for the past few months this would be not new news for you that it had taken another nosedive. A couple of days ago, the BTC was finally recovering and investors thought that the nightmare was over when it reached above $24k and people again started investing following the predictions that it would go up to a million dollars. But as of today 21 August, the price of Bitcoin is just above $21k, and the nightmare is continued.
Not just Bitcoin, but the price of Ether has also reduced in the past 24 hours. Just a couple of days ago, it was almost $2,000 but in the last 24 hours, it also went through a drastic decline and the current price is around $1600 causing a loss of 8% in just one day. 20 August was the darkest day of the year for crypto investors because everyone was carried away by the hoax momentum that the crypto achieved over the past few weeks.
Around one hundred and fifty thousand crypto traders liquidated their assets in the last 24 hours and approximately $550 million dollars went to the gutter yesterday. Around $200 million were lost by Bitcoin liquidations and around $150 million were lost in ether liquidations. After the modified interest rates in case of liquidations of crypto are improved in recent months by the United States Federal Reserve and it is expected to be raised again.
Altcoins also suffered a lot from this catastrophic day, they already are renowned for being more volatile than BTC. Solana went down 14% and Cardano went down 13% during this weekend. Thus all the traders want increased interest rates and US Fed obviously wants to avoid a huge increase in interest rates. James Bullard and Esther George, both are Fed employees and during a meeting on Thursday, they both indicated that the interest rates are not going to be increased a lot and suggested to keep increasing borrowing costs.
The reactions of the traders to this liquidation were mundane and surprisingly there was not a certain rage and fear shown by traders as we would have expected. The reason behind it could be that the traders are now well-aware of the behavior of the market and as all this was followed by a great performance in July where everyone made money so there is a common hope and belief that the market will rise again. The term “crypto winter” is getting more popular which means that we can predict these kinds of sharp falls if traders are able to see a pattern of these kinds of drastic events, informally called “crypto winters’” and that way traders could make strategies to avoid huge losses.