Bitcoin Blasts Past $42,000 While Bigtime, Ordi, Celestia Tokens Face Liquidation Bloodbath

Author: Murtuza Merchant | December 05, 2023 02:27pm

The crypto market staged a remarkable comeback over the weekend, shaking off the shackles of recent bearish sentiment and embarking on a euphoric rally that sent shockwaves through the financial world. 

Bitcoin (CRYPTO: BTC), the bellwether of the crypto space, surged past the psychologically crucial $42,000 mark, reclaiming its position as the most valuable digital asset.

Altcoins followed suit, with Ethereum (CRYPTO: ETH), Solana (CRYPTO: SOL) and Cardano (CRYPTO: ADA) all experiencing significant gains.

Markets experts have attributed the surge in prices to a confluence of factors, including:

• Positive sentiment: The overall mood in the crypto market shifted from pessimism to cautious optimism. Investors are starting to believe the worst of the bear market is over and brighter days lie ahead.
• Short squeeze: A significant number of short positions were liquidated yesterday, further fueling the upward momentum. Short squeezes occur when traders who have bet against a particular asset are forced to buy it back to cover their losses, which can drive prices even higher.
• Institutional interest: Institutional investors, such as hedge funds and pension funds, are showing increasing interest in cryptocurrencies. This influx of institutional capital is seen as a major catalyst for the market's recovery. 

Wes Levitt, CFA co-chief Investment officer and head of Europe operations for Alpha Transform Holdings, told Benzinga the momentum had been building for BTC for weeks as the $36,000 mark was a strong price floor.

He added the market was at a near consensus that the ETF approval would come before the Jan. 10 deadline, so very few participants are willing to sell before then.

Also Read: Bitcoin ETFs: Taiwan Takes Caution Despite Global Frenzy, Citing Crypto Volatility

"Add to that the growing sentiment that central banks will start cutting rates in Q1 and you have a strong bid for BTC. We don't see either of those things changing in the next month unless inflation data is unexpectedly higher and rate expectations turn hawkish," he said.

Meanwhile, in the past 24 hours, the altcoin market experienced significant turbulence, with over $250 million in liquidations across various altcoin futures, notably including Big Time’s (CRYPTO: BIGTIME) and Ordi Protocol’s (CRYPTO: ORDI) tokens.

This event underscored the sector's unpredictable and often rapid volatility.

In other developments, traders of Celestia’s (CRYPTO: TIA) and Memeland’s (CRYPTO: MEME) tokens, both launched last month, incurred losses totaling approximately $10 million.

Additionally, the once-prominent Terra ecosystem's related tokens, including LUNC (CRYPTO: LUNC), USTC (CRYPTO: USTC) and LUNA (CRYPTO: LUNA), saw traders lose around $11 million.

These tokens experienced a surge of up to 70% on Monday, driven by various catalysts.

Read Next: The Fiat World's Looming Obsolescence: Crypto World's Unstoppable Rise According To Macro Expert Raoul Pal

Photo: Shutterstock

Posted In: $ADA $BTC $ETH $LUNA $LUNC $MEME $SOL $TIA