The overall sentiment in the cryptocurrency market has been rather bullish lately due to factors like the upcoming halving on the Bitcoin blockchain and the trading volume of the newly launched spot Bitcoin exchange-traded funds (ETFs).
The market’s growing demand for BTC, especially among traditional institutional investors with the ETFs, led to it recording a new all-time high of $69,350 yesterday.
The surge of the most dominant cryptocurrency was also reflected in the rest of the market as investors appeared to be cashing on their investments.
Investors Liquidate Over $1 Billion in Crypto on The Back of Bitcoin Hitting ATH
According to a newly updated tally from Coinglass, over $1.1 billion in assets have been liquidated from the cryptocurrency market in the last 24 hours on the back of BTC hitting a new all-time high.
Out of the 318,221 tokens that were liquidated, Bitcoin had the largest share, with $340 million worth of BTC cashed out by investors.
Ethereum (ETH) came in second place with over $202.44 million in liquidations. Coinglass’ report also revealed that the single largest liquidation order took place on the Bitmex crypto exchange. One trader liquidated $11.35 million worth of Chainlink (LINK) on the exchange.
The most liquidations in terms of value occurred on Binance, with $467.42 million in crypto tokens being cashed out.
Investors who accumulated meme cryptocurrencies, such as FLOKI, WIF, and PEPE, when they were launched also cashed out their profits.
Spot Bitcoin ETFs Played A Major Role In Launching BTC Towards the Upside
A significant catalyst for Bitcoin’s rally has been the spot BTC ETFs, particularly those from financial giants like BlackRock and Fidelity.
These institutions poured billions of dollars into the crypto asset, effectively reducing its available supply and creating a supply shock within the market.
Just BlackRock and Fidelity hold 269,417 BTC worth over $17.8 billion for their spot Bitcoin ETFs – iShares Bitcoin Trust (IBIT) and Fidelity Wise Origin Bitcoin Fund (FBTC).
The investment vehicles tracking Bitcoin have been one of the most successful ETFs to have ever been launched in the market.
As of March 4, 2024, the 10 spot BTC ETFs listed across US markets have amassed over $7.9 billion in total trading volume.
The maximum number of trades conducted by the funds in a single day was $673.4 million while the minimum was $158.3 million, which was on the first trading day. On average, the spot Bitcoin ETFs have a daily trading volume of $220 million.
Investors are Accumulating Maximum Bitcoin Before April’s Reward Halving
The ETF-driven demand combined with the hype surrounding the upcoming halving event on the Bitcoin network that is scheduled for mid-April, has further strengthened the prospect for BTC’s price to surge.
The halving, which occurs once every four years, reduces the rewards for miners when creating a block on the Bitcoin blockchain. This reduces the rate at which new BTC enters circulation. Currently, miners receive a block reward of 6.25 BTC, which will decrease to 3.125 BTC per block post-halving.
Investors are also rushing to acquire the maximum available BTC before its supply is reduced, which was instrumental in driving the apex cryptocurrency’s price to all-time highs.
At the time of writing, Bitcoin (BTC) is trading at $65,937 – down 1% in the last 24 hours. Meanwhile, Ether (ETH) – the second largest cryptocurrency by market cap – is trading at $3,773 – up nearly 2% in the same period.
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