Bitcoin (BTC) Suffers Flash Crash, Drops Below $23k

News / 21.12.2020

Bitcoin suffered a massive correction a few hours ago, losing $1,500 in value within the space of minutes. This correction came after the leading coin enjoyed a massive rally over the weekend.

Bitcoin (BTC) Price Correction Follows Bullish Weekend

After entering the weekend trading above $20k, BTC quickly surpassed the $22k mark creating new milestones on the way. The leading coin also hit a new all-time high of $24,209 on Sunday, according to data from CoinMarketCap.

Amid expectations that Bitcoin could make a surge towards $25,000, the leading coin suffered a major retracement today. Bitcoin plunged from $24,000 to as low as $22,420 within the space of a few minutes, wiping over $1500 from its price.

This retracement had been expected by key crypto analysts who had predicted a reaction from the markets. The downturn in price also followed a market-wide pullback in traditional finance with major European indices dipping in value.

At the time of publication, Bitcoin has recovered slightly and is trading at around $22,600. This correction could sign that the bears are coming and subsequent support levels for the coin are at the $21,000 mark. However, a positive surge in value could see the asset move towards the $24k mark in the coming hours. If this happens, BTC could make a renewed push towards surpassing the $25k resistance mark.

 Altcoins Bleeding

As expected, the sudden dip of Bitcoin caused a ripple effect in the market with altcoins in the red. Ethereum dropped below $600 momentarily but has recovered slightly to trade at around $609. Nevertheless, the leading altcoin is down by 7% in the last 24 hours of trading.

This trend continues across the top 10 coins with XRP down 8.65%, Litecoin 9.52%, and Cardano 7.90%. The flash crash has also wiped about $28 billion from the market cap within 24 hours.  Bitcoin market dominance has also increased to 66.1% as several altcoins have lost heavily in the past few hours.

Will this massive correction lead to the beginning of the crypto winter? It is still early at the moment. The coming hours will provide a clearer indication of what direction the market is swinging towards.

Olowoporoku Adeniyi is a blockchain enthusiast and crypto evangelist. Currently he loves all things crypto and covers happenings within the blockchain space.