What Happened to Bitcoin-Why Did BTC Price Dropped by More Than 5% in Minutes?

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Bitcoin and Ethereum prices dropped heavily during US trading, mainly due to the fallout from Silvergate, a crypto-friendly bank, which had dropped more than 50%.

The majority of the exchanges, like Coinbase, Circle, Paxos, Crypto.com, Galaxy Digital, and Gemini, suspended their operations with the bank.

A rapid sell-off overtook the major exchanges and expressed huge connectivity issues. 

Following the major fallout, the traders who were bullish on Bitcoin quickly closed their long positions. 

As per the data from Coinglass, more than $200 million in long positions were liquidated, which led to a drastic drop in the BTC price from $23,417.58 to $22,150.31.

With the fall of the BTC prices, the entire crypto space fell back into a deep bearish trend. The global crypto market cap dropped by more than 4% but sustained above $1 trillion. 

So what’s next? Will Bitcoin’s price continue to drop and slash below $22,000, or will bulls hold the price, respecting the support levels?

The BTC price is trading along the lower trend line ever since it rebounded from the bottom in the last few days of February. Therefore, considering the trend line, it appears that the bearish outlook may prevail and the price may drop further. 

During the recent price drop, the BTC price sliced through the lower trend line and was expected to reach the lower support zone between $21,567 and $21,413 if it did not hold at the current levels.

Therefore, the upcoming daily close may play a crucial role in determining the next phase of the Bitcoin price rally, which has scrambled into a bearish trap yet again.