TL; DR
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Every non-stable coin in the crypto top 5 saw its price drop around the same time BTC dropped (see above ☝️).
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Why? Because a (relatively) unknown research group, called Matrixport, released a report who gambled that the upcoming Bitcoin spot ETF (which would make BTC tradable on the stock market and attract new investments) would be rejected.
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As people sold their Bitcoin, they also sold many of the other major coins/tokens they held, because we all adopted the idea we lead by at the top: “If BTC goes up/down, the rest of the market often follows.”
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Now it’s a weird self-fulfilling prophecy…
Full story
Remember yesterday when we said:
“Bitcoin tends to lead the crypto market – when BTC rises, the rest of the market often follows.”
The same goes for Bitcoin prices decrease.
And yesterday morning, that theory was proven in real time.
Every non-stable coin in the crypto top 5 had its price fall off a cliff around the same time (see above ☝️).
Why? Because a (relatively) unknown research group, called Matrixport, released a report who gambled that the upcoming Bitcoin spot ETF (which would make BTC tradable on the stock market and attract new investments) would be rejected.
Their reasoning for this prophecy?
The people at the SEC responsible for ETF approval are mostly Democrats → some Democrats don’t like crypto → therefore they won’t approve a BTC ETF.
It is a fragile argument at best.
But the market took it to heart and sold off a bunch of Bitcoin, creating a domino effect that went something like this:
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A number of people were convinced that BTC would rise in price…
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So they took out loans (also called leverage) to buy more Bitcoin…
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When BTC fell, their lenders forced them to sell and pay back the loans…
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This selling pressure pushed BTC prices even lower, causing more forced selling, causing the price to drop until everything bottomed out…
And while people were selling their Bitcoin, they were also selling many of the other major coins/tokens they owned.
Why? Because we all adopted the idea by which we lead at the top:
“When BTC goes up/down, the rest of the market often follows.”
And now it’s a weird self-fulfilling prophecy…