Altcoins News

Story: Bitcoin Crashes on Mass Position Unwinding, Not Exchange Manipulation

By Bruce Buterin

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Bitcoin took a beating Tuesday. The cryptocurrency plunged from recent highs around $45,000 to hover near $38,000 by February 27, catching traders off guard and sparking fresh…

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Turns out it wasn't some coordinated attack by big exchanges after all. Sources close to major trading desks say the selloff came from widespread position unwinding as individual…

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Market watchers say automatic triggers kicked in once Bitcoin hit certain price levels, creating a cascade effect that made the drop way worse than it needed to be.

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"We saw massive outflows starting around 2 PM Eastern," said one trader at a major crypto desk who didn't want to be named. "It wasn't coordinated selling from institutions.

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Bitcoin's notorious for these kinds of moves, but this one felt different. The cryptocurrency had been climbing steadily through February, hitting peaks above $45,000 just days…

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MicroStrategy didn't get the memo, apparently. Michael Saylor's company bought another 5,000 Bitcoin on February 25 - right before the selloff began.

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But the timing's pretty wild when you think about it. While everyone else was running for the hills, MicroStrategy was backing up the truck.

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Coinbase saw trading volume spike during the chaos, which makes sense. Retail investors love to panic-trade during these kinds of events.

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Elon Musk chimed in on social media Tuesday night, reminding people that crypto's inherently risky.

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The SEC issued one of their standard "we're watching" statements on February 26. They didn't announce any new actions, but the timing wasn't coincidental.

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Things might get more interesting next week. The Federal Reserve meets March 1, and traders are already positioning for whatever Jerome Powell might say about monetary policy.

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The Bitcoin Fear & Greed Index swung hard into "extreme fear" territory, which isn't surprising given the price action.

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Neither Jane Street nor Binance responded to requests for comment about their alleged involvement in the selloff.

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Market participants are still trying to figure out what comes next. Some see this as a healthy correction after Bitcoin's recent run-up.

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Bitcoin closed Wednesday trading around $38,200, still down roughly 15% from its February highs.

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