Key Points
- Bitcoin’s value dropped by 9% due to panic selling by short-term holders and the US Thanksgiving holiday.
- Analysts predict a possible recovery post-Thanksgiving, based on historical trends.
Bitcoin’s price recently fell by 9%, dropping from a record high of $99.5K to $90.7K. Analysts attribute this slump to panic selling by short-term holders (STH) and the US Thanksgiving holiday.
At the time of reporting, the leading cryptocurrency, Bitcoin, had stabilized above $93K, providing some relief from the significant losses experienced in the previous 24 hours. However, what caused this sudden drop on Tuesday, November 26th?
The Reasons Behind Bitcoin’s Drop
The significant drop in Bitcoin’s value occurred mainly between the 25th and 26th of November. Analysts believe that panic selling by STH was a major contributor to this decline.
Crypto analyst James Van Straten noted that short-term holders sold approximately $4 billion worth of Bitcoin, a figure that surpasses the sell-off in August.
The US Thanksgiving holiday was another potential factor influencing Bitcoin’s price. Alex Thorn, the head of research at Galaxy Digital, drew parallels between this year’s drop and the 2020 Thanksgiving Bitcoin dump.
Historical Trends and Future Predictions
Thorn suggested that, based on past trends, the recent 9% dip could mark a local bottom for Bitcoin. Van Straten agreed with this sentiment, noting that Bitcoin’s price has historically followed the STH realized price after significant drops.
However, not all analysts are optimistic about this prediction. Cryp Nuevo, a Bitcoin trader, suggested that the downtrend could continue to the $85K-$88K range before reversing.
The future of Bitcoin’s value remains uncertain, but the consensus among market analysts leans towards a potential recovery following the US Thanksgiving holiday.