Bitcoin Drops Below $109,000, Triggers $97 Million in Liquidations

Bitcoin (BTC) experienced a notable decline, dropping below the $109,000 mark. The cryptocurrency is currently trading at approximately $108,947.0625 USDT, reflecting a narrowed increase of 1.53% over the past 24 hours. This drop occurred after a weekend rise, with U.S. markets closed for Memorial Day. Despite the decline, BTC has shown a 1.7% increase in the last 24 hours, indicating some resilience in the market.

The price drop below $109,000 triggered significant liquidations, with over $97 million in long positions being wiped out. A second wave of liquidations followed as the price dipped further, erasing additional long positions. This liquidation event highlights the sensitivity of the market to price movements and the potential risks for leveraged traders.

The recent price action is part of a broader trend where Bitcoin has seen significant volatility. In January, BTC hit an all-time high of $109,000, followed by a sharp decline to as low as $75,000 in April. The cryptocurrency has since recovered, but the recent drop below $109,000 suggests ongoing market dynamics and potential selling pressure from larger holders.

Strategy, a prominent institutional investor, recently purchased 4,020 BTC for $427 million, boosting its total holdings to 580,250 BTC. This acquisition comes amid signs of distribution from larger whales, who have shown some selling pressure. The selling from these whales triggered two notable long liquidations as BTC dropped from $111,000 to $109,000. Despite this, Bitcoin has shown resilience, trading around $109,000 as institutions continue to accumulate the cryptocurrency.

The current momentum in the Bitcoin market is driven by structured capital inflow and long-term corporate positioning, rather than retail enthusiasm. Institutions are not only holding Bitcoin but also building corporate strategies and business models around it. This shift in market dynamics suggests a more stable and long-term approach to investing in Bitcoin.

The recent price drop below $109,000 also aligns with a notable shift in positioning among the largest holders. Whales holding more than 10,000 BTC have slightly shifted from accumulation to net selling, suggesting modest profit-taking from large holders. However, accumulation remains broad, with other cohorts continuing to buy Bitcoin.

The Long-Term Holder (LTH) Realized Cap jumped to $28 billion for the first time since April, indicating that long-term investors are using this period of forced selling to increase their exposure and accumulate more Bitcoin for the long run. This accumulation from LTH often reflects the potential for future price appreciation as Bitcoin moves into the hands of investors with lower spending tendencies.