Bitcoin, the leading cryptocurrency, experienced a dramatic price drop below the $69,000 mark on Sunday, leading to considerable market liquidations. In an intriguing development, analysts have observed that this decline coincides with a decrease in the winning odds of US Republican presidential nominee Donald Trump ahead of the general elections on November 5.
Bitcoin Price Fall Induces $232.6 Million in Market Liquidations
In recent days, Bitcoin has undergone a notable price correction following an extended rally in October, during which its value surged by 20%. Initially, Bitcoin’s price fell from above $73,000 on Friday, finding support around the $69,000 region. After a brief period of sideways movement, BTC experienced another significant dip on Sunday, reaching a local bottom at $67,960.
During this price decline, cryptocurrency analyst Ali Martinez highlighted that approximately 104,787 trading positions were liquidated, resulting in a loss of $232.6 million. According to data shared by Martinez, long traders were hit hardest, accounting for $198.6 million in liquidations, while short positions accounted for $34 million. This suggests that many traders had anticipated a rebound in the crypto market’s leader following its initial price pullback on Friday.
As of the current moment, Bitcoin has retraced to above $68,000, with little indication of its next price movement. If the ongoing downtrend persists, Bitcoin could potentially drop to as low as $55,000, continuing a range-bound movement that has persisted for the past eight months. Conversely, Bitcoin could experience a price recovery, potentially returning to levels near its all-time high of $73,750. This possibility is bolstered by bullish sentiments amid heightened ETF inflows, the impending US election, and an anticipated Federal Reserve rate cut of 25 basis points.
Is a Potential Trump Loss a Threat to Bitcoin?
Interestingly, Bitcoin’s decline on Sunday appears to be correlated with a decrease in the winning probability of US presidential candidate and crypto enthusiast Donald Trump. According to data from Polymarket, Trump’s chances of winning the presidency on November 5 fell by 4.3% after his opponent, Democratic candidate and US Vice President Kamala Harris, emerged as the favorite to win in Pennsylvania.
Despite this shift, Donald Trump remains the frontrunner to become president, holding a 53.8% chance compared to Harris’s 46.1%. However, recent Bitcoin price reactions suggest that a potential loss by the Republican candidate could lead to a significant price decline for the cryptocurrency market leader. Historically, though, Bitcoin has demonstrated resilience, consistently embarking on a bullish trajectory following US elections, regardless of the outcome.
Currently, Bitcoin trades at $68,471, reflecting a 1.38% loss over the past 24 hours. Meanwhile, the asset’s daily trading volume has decreased by 40.54%, valued at $24.40 billion.
