Why are cryptos like Bitcoin, Ethereum and XRP crashing?

• Bitcoin collapsed to $42,500, triggering a widespread market crash.
• The 1-hour volume increased while many long positions were wiped out.

The enthusiasm about a Bitcoin [BTC] bull run in 2024 has faced a setback as the price fell by 4.85% in the last hour at press time.

According to CoinMarketCap, BTC started the 3rd of January above $44,000 with many predicting that the coin would hit $50,0000 before the month ends.

However, all that may have been put to rest at the moment as BTC’s press time price was a little above $42,500. Furthermore, Bitcoin was not the only cryptocurrency affected.

Solana [SOL] fell by 7% within the hour while XRP plunged by 12%. Ethereum [ETH] also joined in with a 5.30% plunge.

Bitcoin ETFs to be delayed?

At press time, AMBCrypto found out the major reason for the nosedive. Before the dump, Matrixport reported that the U.S. SEC would not approve any Bitcoin ETFs this month.

The news sent panic around the market. Also, Economist and trader Alex Kruger noted earlier that a crash was coming.

Furthermore, Bitcoin’s trading volume surged as a result. At press time, BTC volume surpassed $40 billion. This was proof of high selling pressure. Liquidations have also affected traders, especially longs.

According to Coinglass, the Liquidation HeatMap showed that over $500 million had been wiped out. Bitcoin took a large part of the hit with $72.13 million.

Details from the HeatMap also showed that longs were the most affected.

Source: Coinglass