Cryptocurrency Bitcoin Drops Below $115K, Triggering $530 Million in Liquidations
In the world of cryptocurrency, Bitcoin has been experiencing some fluctuations recently. Despite a 2.89% drop in price over the past 24 hours, with the digital currency currently trading near $114,839, the long-term growth potential for Bitcoin remains positive, albeit cautious.
According to an analysis shared by an analyst from CryptoRank, Bitcoin usually tracks M2 trends, with a slight delay. This suggests that global liquidity, as measured by the M2 money supply, plays a significant role in Bitcoin's price movements.
The broader liquidity trends suggest potential for long-term growth in the Bitcoin market. In fact, when global M2 supply grows, particularly under quantitative easing policies, investors tend to seek higher returns by buying riskier assets like Bitcoin. Bitcoin's price has a high sensitivity (beta of 1.5 to 2) to liquidity changes, often moving sharply upward as M2 expands.
Recent events have seen increased selling pressure in the crypto market, with Galaxy Digital's transaction of 12,000 BTC across various exchanges potentially contributing to the price drop. This selling pressure has resulted in nearly $530 million in liquidation in the past 24 hours, as reported by Coinglass data.
However, it's important to note that the current dip might not be indicative of a fundamental shift in the Bitcoin market. Analysts remain optimistic about Bitcoin's long-term growth, pointing to Bitcoin's close relationship with the global M2 supply.
The trend of increasing open interest in Bitcoin options suggests that institutional and retail traders are becoming more active in the market. The open interest in Bitcoin options has significantly increased, rising from less than $1 billion in June 2023 to over $60 billion by mid-2025.
Stronger price swings are anticipated with the increased open interest in Bitcoin options. However, these swings may reflect seasonal trading patterns and a cautious reassessment rather than an outright loss of confidence.
In summary, Bitcoin's long-term growth remains fundamentally linked to global liquidity dynamics, but near-term price action reflects typical market corrections and macro uncertainties. Despite short-term volatility, the long-term growth of Bitcoin remains intact.
Technology plays a crucial role in Bitcoin's growth potential, as demonstrated by its correlation with global M2 trends. Investing in Bitcoin, therefore, can be seen as a means of technology finance, as its price movement often mirrors changes in the broader liquidity.
