30K Bitcoin Plunge: Short-Termers Sell, Long-Termers Unfazed

• Bitcoin’s 30k plunge and short-term holders sell off BTC, long-term holders remain unfazed
• Fed balance sheet declines for fourth consecutive week – down $141B
• 20k BTC re-enters exchanges following largest Bitcoin long liquidation event this year

Bitcoin Price Plunge

Bitcoin experienced a dramatic plunge in its price on April 19th, 2021. Short-term holders scrambled to sell their BTC, while long-term holders remained unfazed as the cryptocurrency’s value decreased.

Fed Balance Sheet Declines

The Federal Reserve’s balance sheet has been declining since March 24th, 2021. This marked the fourth consecutive week of decline, totaling $141 billion in losses over that period.

Bitcoin Long Liquidation Event

20 thousand bitcoins were re-entered into exchanges following the biggest ever Bitcoin long liquidation event of all time on April 19th, 2021. This is the largest such event in crypto history and highlights the volatility of the market during times of extreme market stress or uncertainty.

Central Banks‘ Dilemma

The central banks face a difficult dilemma: dealing with inflation while also avoiding stagflation. Cryptocurrencies may offer a solution to this issue as they could provide an alternative form of money that is not subject to traditional inflationary pressures or governmental policies.

Effects on Short & Long Term Holders

Short term traders experienced heavy losses from this sudden drop in prices, but long term investors managed to escape without much damage due to their strong portfolio diversification strategies and confidence in the cryptocurrency’s future prospects. In addition, by holding onto their coins despite volatile market conditions, these investors have been able to reap significant rewards when prices eventually recovered.