The collapse of the cryptocurrency market accelerated overnight as its leading cryptocurrency, 'Bitcoin price', fell 5.2% to a low of $100,345. This decline was attributed to the liquidation of leveraged trades, geopolitical factors, and the discord between Elon Musk and Donald Trump.
Read on as this article will shed light on the main reasons behind the overnight collapse and whether the BTC bull run has ended.
Summary of reasons for Bitcoin's price drop yesterday
The main reason for this decline is that Trump signed a new executive order, which stirred up volatility in major financial instruments and also affected BTC sentiment. His latest executive order dealt a heavy blow to steel and aluminum tariffs, which surged 50%, to boost production at U.S. domestic factories.
Similarly, debates with China have once again started to heat up, and no solutions have been presented between China and the United States. Due to these global pessimistic factors, the cryptocurrency market shifted into a bearish mode last night, with increasing instability also causing delays in major technological advancements.
The result of the bearish mode has caused the liquidation of 215,593 traders in the past 24 hours and the total liquidation amount reached $967.63 million, according to Coinglass. Coinglass reported that the largest single liquidation order occurred on Bitmex – XBTUSD, worth $10.00 million.
Meanwhile, a famous whale, James Wynn, liquidated long positions worth $16.14 million. As a result, he had to close all his running long positions, according to a report from Lookonchain.
Along with these pessimistic events, the disagreement between Trump and his old friend, Elon Musk, is also adding bearish pressure to the market. This discord is due to the 'big, beautiful bill', where Musk demands an end to EV subsidies and repayment to the country.
The combination of these factors is having a strong impact on the cryptocurrency market, as Donald Trump and Elon Musk are known as prominent supporters of cryptocurrency in the field, and their discord is affecting investor sentiment.
Should we be worried about the price of Bitcoin?
After the disaster last night for top cryptocurrencies and altcoins, June 6 saw a 3% increase to $103,976, while the recent 12-hour decline also showed increased short liquidations compared to buying.
This sudden optimism comes as controversial and prolonged trade talks between the United States and China are about to be restarted, reversing the bearish situation of yesterday and keeping BTC above last month's support zone.
Therefore, if things go down and pressure increases, by the end of June, the price could drop as low as $92,917. However, if things go up, this time the target is $130,000 by the end of June.
