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Bitcoin crash causes Panic among Investors

Why did Bitcoin Crash?


Today bitcoin prices fell by more than $10,000 which indicates a correction of almost 20%. Sooner or later, it was expected to happen. A correction is an imminent phase of any price movement. 

The thing about which everyone is curious about is whether this will be a long-term correction or investors will be able to keep the market up. 

More and more investors are panic selling, while large players have started accumulating assets. This correction was very important for a healthy market. The dominance of Bitcoin in the market was growing for a very long time.

Volatility comes into play

Today the old factor of volatility showed its effect on the market. When the prices of bitcoin were touching new all-time highs, the volatility factor came into play. Small investors panicked and began selling their assets. This crash may work to calm things down in the market.

We may see bitcoin going towards the $42,000 mark with a 28% correction. We might witness bullish selling from the investors.

Possible reasons for Bitcoin crash

A reason for the Bitcoin crash maybe a large sell-off from the miners when Bitcoin reached its new all-time high price. Very few numbers of investors were interested in buying the dip as per the previous trends. 

A further expected dip from the investors may be the reason we can't see the green candles on the bitcoin price chart. We could clearly see a huge volume of panic selling which is indicated by red candles in the Bitcoin price chart.

Another reason can be a large sell-off from multiple bitcoin whales who had held onto the bitcoin for a very long time period. A bitcoin whale is a large purse holder of Bitcoins. 

They control tens of thousands of bitcoin present in the market. Most profits were gained by these whales and miners when they sold their assets at an all-time high price.

Options post the bitcoin crash

Major buyers may target the dip to make maximum profit when the prices of bitcoin start rising again. This is a testing phase for small investors. Small investors should hold their assets through the dip to benefit in the future.

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