What caused Bitcoin to slide down to $38,500 causing extreme fear among investors?

At noon this afternoon, the Bitcoin price suddenly plunged to about $ 38,500 according to the information recorded on the Binance exchange, today’s BTC price has hit its lowest level since March 15. Let’s find out why with Primexbttradingnow.com What leads to this?

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Having lost the $39,000 mark, Bitcoin has moved below the trendline support, which has acted as a bottom for the past 80 days.
As the chart shows, traders failed to sustain the previously established support, which caused the price to drop below $39,000. Bitcoin has dipped below the previous support but only in the form of a candlestick, which is not generally considered a support break.
In the current case, Bitcoin opened right at the trendline, so it could still bounce back, leaving the support area as hard support and unbroken.

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Some of the main reasons
The US Federal Reserve’s tightening monetary policy at a rapid pace to curb inflation has put a lot of pressure on cryptocurrencies.
Veteran trader Peter Brandt recently predicted that Bitcoin price could continue to trade sideways for years before the start of another possible major rally in 2024.
The Crypto Fear and Greed Index, a widely watched sentiment indicator, shows that Bitcoin traders are still “extremely scared.”

There is no underlying reason or any other specific reason behind the drop, which can cause traders to immediately sell their holdings. But we can highlight unusual trends seen last week as traders actively moved liquidity away from exchanges.
Not only has a large amount of Bitcoin left exchanges, other cryptocurrencies like Ethereum are also facing a supply crisis after traders moved $4.3 billion worth of tokens out of exchanges. .
Another aspect that can affect cryptocurrency prices is mining activity. According to the latest data from blockchain analytics platform Glassnode, Bitcoin’s mining difficulty has so far lost more than 1.26% after growing around 4.13% at the end of March this year.

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The Bitcoin hashrate suffered similar consequences, falling to 202 EH/s since its all-time high set on February 14 at 248.11 EH/s.
Meanwhile, Kazakhstan is taking steps to increase taxes on crypto-mining organizations in the country. According to the country’s Minister of Economy, the latest plan is to charge a tax based on the market value of the cryptos mined.
The government official noted that implementing such a plan would increase budget revenue. In addition, miners operating in Kazakhstan are also paying a surcharge for the amount of electricity consumed. Tariffs were increased at a fee of 1 Kazakh tenge (about $0.0022) per kilowatt-hour of electricity used.

Miners here are seriously threatened by riots and protests as well as lack of electricity. This leaves the country facing another wave of migration.
In addition, cryptocurrency miners in Iran are facing heavier penalties as the country’s government is closely monitoring cryptocurrency mining activities that operate illegally. Mining operations are prohibited from using electricity intended for households and industrial subscribers. Previously, the Iranian government announced a four-month cryptocurrency mining ban in May. It was temporarily lifted in September.

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Altcoins are also bloody
As for altcoins, most of them have underperformed within the last 24 hours, which often happens during broad market corrections.

Avalanche (AVAX), Cardano (ADA) and Terra (LUNA) are down more than 6% in the past 24 hours.
Decred (DCR) is one of the few top 100 cryptocurrencies in the green, up over 28%.
According to data provided by Coinglass, over $234 million in cryptocurrencies were liquidated during the day with long positions accounting for 88.72%.

The entire market cap is now at $1.8 trillion and Bitcoin’s market dominance is still stuck at 41%.
Is there any root cause behind the decline of BTC in particular and the current cryptocurrency market in general? Follow Primexbttrading for more useful information.

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