- Bitcoin’s price hit a new all-time high above $73,000 on Tuesday before suddenly crashing down $4,000 within minutes.
- The swift plunge liquidated over $360 million worth of leveraged positions in crypto derivatives markets as long traders were hit hard.
- After rebounding back above $71,000, bitcoin remains on a bull run overall but may see more volatility as the market decides on direction going forward.
Bitcoin experienced extreme price volatility over a four hour period on Tuesday, reaching new highs before tumbling and then recovering again. The price swings led to massive liquidations in crypto derivatives markets.
The New Record High
On Tuesday, bitcoin’s price shot up past $73,000 for the first time, setting a new all-time high. The leading cryptocurrency has been on a bull run over the past week as investors gain confidence amid inflation concerns.
The Sudden Crash
After reaching the new peak, bitcoin’s price plunged around $4,000 within minutes, tumbling down to $69,000. The swift decline liquidated over $360 million worth of positions in crypto derivatives markets. Long traders were hit hard as over-leveraged bullish bets were wiped out.
Rebounding to Stability
Following the crash, bitcoin’s price rebounded back above $71,000, recovering some of the losses. The wild price swings have led analysts to expect a period of consolidation as the market calms down from the volatility. While bitcoin’s long-term trajectory still looks positive, the rally may be losing momentum.
Conclusion
Bitcoin’s massive price fluctuations on Tuesday provided a reminder of the cryptocurrency’s volatility even amid an ascendant bull run. The tumble led to leveraged traders being liquidated en masse, but bitcoin remains on solid footing above $70,000. Going forward, more swings are likely as the market decides on direction.
