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Why Bitcoin Price is Down Today? Wiped Out $500 in Billion
Bitcoin has experienced a catastrophic crash, plummeting to a 4-month low of $82,300 and wiping out an astonishing $500 billion from the market. The sudden price drop has triggered massive liquidations, resulting in $770 billion being wiped out in just a single day.
As the market cap plummets to a staggering $2.8 trillion, investors are scrambling for answers as to what’s behind this unprecedented downturn. Let’s dive into the primary factors driving Bitcoin’s price decline.
Firstly, the sudden surge in AI stocks and NVIDIA’s impressive Q4 revenue report have caused a significant shift in investor confidence from digital assets like Bitcoin to high-growth AI-related investments. The chipmaker reported an incredible $39.3 billion revenue in Q4, resulting in a 12% increase from the previous quarter and a massive 78% rise year-over-year. This strong performance has led investors to redirect their funds towards NVIDIA and other AI stocks.
Secondly, Bitcoin ETFs have recorded seven consecutive trading sessions of outflows, totaling $2.43 billion between February 24 and February 26. This continuous trend of selling pressure from major financial institutions like Fidelity has further exacerbated the price drop.
Lastly, a significant portion of Bitcoin options contracts, valued at $3.9 billion, is set to expire on February 28, with around 78% of these contracts not being profitable. Additionally, $1.3 billion in Bitcoin has been moved from cold storage to exchanges, which may lead to further selling pressure.
The Relative Strength Index (RSI) has dropped to a concerning level of 25.92, indicating extreme overselling. Historically, when the RSI falls below 30, Bitcoin tends to experience a short-term price bounce.
As investors struggle to comprehend the reasons behind this dramatic downturn, it’s essential to remember that the cryptocurrency market is known for its volatility and unpredictability.
Source: https://coinpedia.org/news/why-bitcoin-price-is-down-today-wiped-out-500-in-billion/
