What is the reason for the bitcoin price drop?

The new collapse in the value of Bitcoin was caused by the “cryptocorralito”, which was baptized by various media and experts on this topic.

The dramatic collapse of Bitcoin in the last hours, which reached a value of less than $23,000, will have one or two reasons behind it, which has alarmed the entire crypto market, especially investors.

According to international media, it was companies like Binance or Celsius that caused the massive drop, as both suspended Bitcoin withdrawals on their different platforms.

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In the Celsius case, according to an article published by the Spanish newspaper “El Mundo”, the decision was made because the company seeks to “improve” its waiting periods when executing deals, as well as to enhance its liquidity.

In that sense, the company stated that the suspension was in order to “protect users’ assets,” which rather than help improve a situation the market was already facing, ended up exacerbating it.

The suspension of withdrawals carried out by Binance was one of the reasons for the downfall of Bitcoin. Photo: EDH / Archive

The new crash, which has already appeared against the background of the collapse of the Luna and UST tokens from Terraforms, is called “cryptocorralito”, because its purpose, in fact, is to prevent the leakage of bitcoins. From Binance and Celsus, although in the case of Binance, transactions have already been restored.

In addition, another possible reason for this collapse, according to US media CNBC, is the massive sell-off of cryptocurrencies that occurred over the weekend, in which up to $200,000 million of bitcoins were liquidated, as part of the fear of crypto holders. that encryption.

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The above could happen due to the last known inflation indicator in the US, which reached 8.6% y/y which could lead to a new rise in the interest rates regulated by the Federal Reserve (Federal Reserve, for short).

According to CNBC, the market capitalization of all cryptocurrencies has lost as much as $1 trillion ($1 million) today alone, fueled by the massive crash of Bitcoin.

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