Bitcoin Dips Below $58,000 Amid Market Volatility

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On July 4, Bitcoin experienced a notable price drop, briefly falling to $57,874 on Coinbase, marking its first dip below the $58,000 threshold in over two months. As of the latest data, Bitcoin has recovered slightly to trade at $58,964, but it remains down 3.4% for the week, according to TradingView.

Bitcoin Price Tanks

This decline has significantly impacted leveraged long positions, resulting in considerable liquidations. Data from CoinGlass reveals that over $54.9 million in Bitcoin long positions were liquidated within the last 24 hours. This sell-off has also affected Ether (ETH), with $57.9 million in long positions liquidated in anticipation of the upcoming spot Ether ETFs expected to launch by mid-July.

The market’s downturn is partly attributed to the impending repayment by the defunct Japanese crypto exchange Mt. Gox, which is set to return approximately $8.5 billion worth of BTC to its creditors starting in early July. Some analysts believe this repayment may not have as severe an impact as feared, but the uncertainty has still weighed heavily on market sentiment.

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Altcoins Also Nosedive

Other major cryptocurrencies have also seen sharp declines. Ether (ETH) dropped 4.5%, reaching a low of $3,145 during a sharp sell-off on July 4 at 2:00 am UTC. Binance Coin (BNB) fell by 6%, moving from $573 to $539. Solana (SOL) saw a significant decrease, losing 10.3% in the past 24 hours, plunging from a weekly high of $154 to $136.

Buy Bitcoin Chants

Despite the market turbulence, there has been a notable increase in social media activity around the phrase “buy the dip.” According to crypto research firm Santiment, mentions of this phrase have doubled across platforms like Reddit, X, 4Chan, and Bitcoin Talk. Santiment noted, “The crowd is showing signs of seeing this as a buy the dip opportunity,” but advised caution, suggesting the optimal time to buy is when enthusiasm settles down.

Currently, Bitcoin is trading at $58,900, its lowest level since May 3, based on CoinGecko data. Market sentiment, as measured by the Crypto Fear and Greed Index, is in the “Fear” zone with a score of 44 out of 100. This index reached an 18-month low of 31 on June 25 and has fluctuated between 30 and 53 since then.

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Tom Lee, founder of financial research firm Fundstrat, discussed the situation on CNBC, attributing much of the negative sentiment to Mt. Gox’s planned Bitcoin repayments. Lee highlighted the concern that a significant sell-off by Mt. Gox’s 127,000 creditors could further depress Bitcoin’s price.

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