What is causing Bitcoin to lose value so dramatically?

(NLDO)- The cryptocurrency market is fluctuating strongly as many investment funds and asset managers switch to a defensive stance, prioritizing profit preservation.

On the afternoon of November 21, the cryptocurrency market recorded a strong red color. Data from the OKX exchange showed that in the past 24 hours, the price of Bitcoin has decreased by more than 10%, down to 82,790 USD.

The prices of other cryptocurrencies also fell significantly, such as Ethereum down more than 10% to $2,690; XRP down nearly 10% to $1.9; BNB down more than 9% to $819; Solana down more than 11% to $126.

According to CoinTelegraph , the market suffered a new wave of selling combined with changes in global interest rate expectations.

Bitcoin's price has now fallen more than 20% in a month, a much steeper decline than the stock market, which has remained stable thanks to positive business results from major technology corporations.

Some market makers believe the decline is due to the sudden transfer of large amounts of Bitcoin that have been "dormant" for many years to exchanges.

Bitcoin is trading in the $82,790 region Source: OKX

This shows that long-term investors are selling Bitcoin, causing a sharp increase in supply and selling pressure to overwhelm buying pressure.

In this context, many investment funds and asset managers have turned to a defensive stance, prioritizing profit preservation, causing market liquidity to thin, especially at important support price zones.

The bearish sentiment is even more pronounced in the derivatives market, with investors betting mostly on a bearish scenario, while hedging instruments moved lower, reflecting concerns that Bitcoin prices could fall further.

Options trading data shows that the market's "hot spot" of interest has shifted from bullish expectations to a bearish scenario close to the $80,000 mark.

Meanwhile, attention is turning to a business that holds a large amount of Bitcoin, with the price approaching an average cost of more than $74,000.

If Bitcoin continues to fall, the psychological and financial pressure on this business will increase. At the same time, a major US bank warned that the company's stock is under pressure due to concerns that it could be removed from a major index early next year.

If that happens, billions of dollars in index funds could be withdrawn, further destabilizing the already fragile cryptocurrency market.

Source: https://nld.com.vn/dieu-gi-dang-khien-bitcoin-mat-gia-du-doi-196251121170825273.htm