TL; DR
Full story
If you buy crypto with your own money, it’s up to you when you sell.
If you buy crypto with borrowed money (also known as leverage), it is up to your lender to decide when to sell.
…and anyone with an internet connection can see where these ‘forced selling points’ are piling up, using something like CoinAnk.
Let’s say Bitcoin is around $64,000, and there are hundreds of millions of potential foreclosures that will happen around $61,000…
Large BTC holders (aka: whales) are incentivized to sell a large portion of their holdings → lower the price to $61,000 → trigger these forced sales → depress the price even lower → at which point these whales can buy back at a discount.
(Essentially moving money from the pockets of leveraged buyers into their own).
Yep, that’s what happened yesterday morning, with the help of the news that Mt Gox (an old Bitcoin exchange that was hacked and went under) will soon start paying back billions to its creditors between July and October.
(Creditors who may want to sell their Bitcoin after not having access to it for about a decade).
As a result, sentiment in the crypto market is in the toilet, with no clear stories in the pipeline that promise to change this.
…other than:
There isn’t much leverage for whales to take out below Bitcoin’s current price, but there’s a good $1 billion+ for them to gobble up above it, for ~$64.6k.
Let’s hope they move things in that direction.