Despite early hopes for a steady price rise with the start of a typically bullish Q4, Bitcoin is struggling to hold its ground, recently dropping to $54,000. Due to its ongoing bearish trend, prominent crypto analyst Ali Martinez has warned that Bitcoin could decline further, potentially dropping to $31,500. Here’s why analysts predict this drop.
Stark Warning: BTC Plunging To $31,500
In a recent tweet post, Ali Martinez pointed out that historically, Bitcoin tends to experience further declines once it falls below the Realized Price-to-Liveliness Ratio. This key metric, currently at $51,600, is an important indicator that tracks the cost basis of Bitcoin holders and the overall market activity.
If Bitcoin breaks below this level, Martinez believes the next stop could be $31,500, which is the Realized Price, an average price at which all Bitcoins in circulation are bought. This pattern has been observed in previous market cycles.
When Bitcoin drops below the Realized Price-to-Liveliness Ratio, it tends to continue its drop further until it reaches the Realized Price which is at $31,500.
Meanwhile, Martinez’s warning comes as Bitcoin has been struggling to maintain momentum after a recent market downturn, and the crypto market is closely watching these critical levels.
Bitcoin Price Action
As of now, bitcoin price is trading around $54,340, reflecting a rise of 1% seen in the past 24 hours. Despite this BTC trading volume has seen a drop of 62%, currently hovering at $18 billion, with a market cap of $1.07 trillion. At the same time, Bitcoin’s dominance in the market has dropped slightly to 56.81%, reflecting a 0.09% decrease in the last day.
Meanwhile, recent data from Soso shows Bitcoin ETFs experienced a major outflow of $706.19 million by September 6, the largest since these exchange-traded products were launched this year.
