Crash warning: Bitcoin plummets, cryptocurrency market 'on fire'

According to data from CoinMarketCap, at 7:52 a.m. on April 14, Bitcoin - the largest digital currency by market capitalization in the cryptocurrency market - plunged to the price range of 63,877 USD, after reaching 71,000 USD just 1 day before.

In the past 24 hours, Bitcoin value has decreased by nearly 5%. In the past 7 days, Bitcoin has lost 7.53% of
its value.

In the past few weeks, Bitcoin price has often had strong fluctuations. Many experts believe that the above situation may come from investors' psychology before the halving event as well as fluctuations in the global economic situation.

Every four years, a halving event occurs, cutting the circulating supply of cryptocurrency in half to create a scarcity effect, making Bitcoin literally 'digital gold'. This can push the price of Bitcoin to skyrocket, but it can also drag the value of this asset down.

In a recent post on social media platform X, cryptocurrency analyst Rekt Capital said that Bitcoin is entering a "danger zone" ahead of the halving period. In the past, Bitcoin price has had strong corrections many times before the halving took place.

Analyst Rekt Capital shared that in previous cycles, Bitcoin prices dropped sharply in the period of 14-28 days before the halving took place. During the correction in 2016, the price of Bitcoin fell by 40%. In 2020, Bitcoin also lost 20% in value.

From the beginning of 2024 until now, Bitcoin has continuously grown, even exceeding the old peak in history when reaching a value of nearly 73,600 USD. This is also the first time Bitcoin has done this before the halving event.

However, by dawn on April 13 (Vietnam time), Bitcoin price suddenly had a strong adjustment. The decrease in Bitcoin price also causes the entire cryptocurrency market to become "red hot". A series of other major cryptocurrencies dropped sharply in price.

Ethereum (ETH), the second-largest cryptocurrency by market capitalization, fell as much as 12% at one point before narrowing its decline to nearly 8%. On the morning of April 14, Ethereum was trading at the price range of 2,900 USD.

Many other cryptocurrencies dropped even more sharply. Altcoins with mid or low capitalization decreased by 20-30% in just 1 day.

According to Coinglass, over 900 million USD in futures trading positions on exchanges were liquidated after the market decline, of which more than 80% were long positions.

The plunge in the cryptocurrency market occurred when the US stock market sank into the red, amid escalating fears of conflict in the Middle East.

Meanwhile, Treasury bonds and the US dollar index (DXY) increased sharply. The price of gold fluctuates strongly. The precious metal at one point reached a record high of 2,430 USD per ounce then plummeted to 2,335 USD in just a few hours.

In addition, the hotter-than-expected CPI index in the latest data also reduces hopes of lowering interest rates by the US Federal Reserve (Fed), amid concerns that the mechanism's ability to curb rising price levels will increase. This approach is not really effective.