The crypto market is experiencing turbulence at the end of 2023. Bitcoin has seen its price fall below the symbolic mark of $42,000, under pressure from sellers. Increased volatility also leads to increased liquidations of leveraged positions. Amid this turbulence, investors are wondering what 2024 has in store for the sector.
Bitcoin falls below $42,000 amid selling pressure
This new slide in bitcoin follows a period of intense volatility. In just 24 hours, its price fell by more than 3%, reaching $41,998 this Wednesday, December 27, according to Block data.
This plunge is partly the result of a surge in short-selling by short-term bitcoin holders, engaging in essentially speculative behavior.
Simultaneously, the number of confirmed transactions on the bitcoin blockchain reached historic highs, exceeding 633,000 per day. Daily bitcoin trading volume now nears $28 billion, nearly double levels observed last October and November.
These upheavals caused the liquidation of more than 44 million leveraged trading positions in the last 24 hours, mainly short positions amounting to $38 million.
Feverish wait for Bitcoin Spot ETFs
Despite this air gap, these turbulences should not obscure the excellent results of bitcoin over the whole of 2023: +155% since January. Above all, many specialists maintain a measured optimism regarding 2024.
This enthusiasm is based in particular on the highly anticipated approval, in the first quarter of 2024, of the first ETFs backed by the price of bitcoin by the SEC, the American stock market watchdog. A crucial step to attract institutional investors and simplify individual access to bitcoin.
Certainly, these approvals would only boost prices temporarily, according to Andre Dragosch of ETC Group. But the gradual influx of new capital could, ultimately, double the price of bitcoin by the end of 2024. An encouraging prediction which suggests bright prospects for the crypto star.
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