Decentral Block Post

Bitcoin (BTC) has been unable to restore the $24,000 support since Celsius, a popular staking and lending platform, paused withdrawals from its platform on June 13. A growing number of users believe Celsius mismanaged its funds following the collapse of the Anchor Protocol on the Terra (LUNA; now LUNC) ecosystem and rumors of its insolvency continue to circulate.

An even larger issue emerged on June 14 after crypto venture capital firm Three Arrows Capital (3AC) reportedly lost $31.4 million through trading on Bitfinex. Furthermore, 3AC was a known investor in Terra, which experienced a 100% crash in late May.

Unconfirmed reports that 3AC faced liquidations totaling hundreds of millions from multiple positions agitated the market in the early hours of June 15, causing Bitcoin to trade at $20,060, its lowest level since Dec. 15, 2020.

Let’s take a look at current derivatives metrics to understand whether June 15’s bearish trend reflects top traders' sentiment.

Margin markets deleveraged after a brief spike in longs

Margin trading allows investors to borrow cryptocurrency and leverage their trading position to potentially increase returns. For example, one can buy cryptocurrencies by borrowing Tether (USDT) to enlarge exposure.

Bitcoin (BTC) plummeted close to the crucial support of $20,000 as traders panicked and dumped their holdings, fearing an aggressive rate hike by the United States Federal Reserve on June 15. Another reason for the sell-off could be fears of possible contagion if lending platform Celsius and crypto venture capital firm Three Arrows Capital (3AC) go belly up.

Data from on-chain analytics platform CryptoQuant showed 24-hour exchange inflows of 59,376 Bitcoin on June 14, the highest inflows since November 30, 2018. The Bitcoin miners also joined other investors in sending Bitcoin to the exchanges. The Bitcoin Miners to Exchange flow metric reached a seven-month high of 9,476, indicating that the miners may be anticipating a further fall in the near term.

Prominent investors are divided on whether a bottom has been made in Bitcoin or not. Galaxy Digital Holdings chairman and CEO Mike Novogratz believes that Bitcoin could hold $20,000 and Ether (ETH) may bottom out at $1,000. These levels were also referred to by Arthur Hayes, co-founder and former chief of BitMEX, who cautioned that if the levels crack, it may lead to “massive sell pressure in spot markets.”

What are the important levels to watch out for on Bitcoin and major altcoins? Let’s study the charts of the top-10 cryptocurrencies to find out.

BTC/USDT

Bitcoin remains in a firm bear grip. The bulls tried to start a recovery on June 14, as seen from the long wick on the day’s candlestick, but the bears were in no mood to relent. They sold aggressively and pulled the price to $20,111 on June 15.

Bitcoin (BTC) spared hodlers the pain of losing $20,000 on June 15 after BTC/USD came dangerously close to last cycle's high.

Bitcoin "bottom" fools nobody

Data from Cointelegraph Markets Pro and TradingView showed BTC/USD surging higher after reaching $20,079 on Bitstamp.

In a pause from its sell-off, the pair followed United States equities higher on the Wall Street open, hitting $21,700. The S&P 500 gained 1.4% after the opening bell, while the Nasdaq Composite Index managed 1.6%.

The renewed market strength, commentators said, was thanks to the majority already pricing in outsized key rate hikes by the Federal Reserve, due to be confirmed on the day.

Nonetheless, it was crypto taking the worst hit in the inflationary environment, Bloomberg chief commodity strategist Mike McGlone noted. In a tweet, he contrasted Bitcoin and altcoin performance with skyrocketing commodities, notably WTI crude oil, futures of which now traded at almost double their 200-week moving average.