BTC fell to its lowest price in seven weeks, reaching $39,500 during the Asian trading session on Tuesday morning.
The 3% daily decline brought the magnitude of BTC's decline to 18.5% from its Jan. 10 peak at $48,500. Furthermore, analysts have predicted that the correction could continue and be up to 30%, which would send Bitcoin price back to $34,000.
Grayscale Selling Dumps Markets
On January 23, on-chain analytics platform CoinGlass published a liquidation heatmap with a bright spot at that $34,000 level. CoinGlass also reported that there were $225 million worth of liquidations in the last 24 hours. The majority were in long positions for Bitcoin and Ethereum.
“Grayscale continues to push the market,” it said, adding that there are still more than 550,000 BTC in the company’s Bitcoin Trust (GBTC).
However, according to CC15Capital, a net 27,717 BTC have been purchased by fund issuers since spot ETFs were launched. That equates to about $1.1 billion at current prices, despite GBTC outflows.
Tether and VanEck strategist Gabor Gurbacs commented that Bitcoin ETFs absorbed the FTX-GBTC real estate sale fairly quickly and without much impact. “Real estate sales are no longer a disaster,” he said, adding:
“Bitcoin flows from weak hands to strong hands. I'm glad we made ETFs possible. It changes the game and tames downside volatility.”
“Monday was a bloodbath for most of the crypto sector,” Santiment reported on January 23rd. The blockchain analytics provider added that there was 35% less discussion about BTC and 21% less about ETH than before the ETF approval week.
“FUD is starting to come into play, which should create good opportunities for prices to rise as it peaks.”
Elsewhere in crypto markets
Total market capitalization is down 2.8% intraday to $1.65 trillion at the time of writing.
Furthermore, Bitcoin has recovered slightly and reclaimed the $40,000 mark, but the short-term outlook spells more problems.
Altcoins were a sea of red on Tuesday morning in Asia, with Solana (SOL), Avalanche (AVAX), Chainlink (LINK) and Litecoin (LTC) suffering the biggest losses.
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