Bitcoin experienced a significant drop to a two-month low of $26,188 early this morning, amid a rising dollar strength and a slowdown in Ordinals hype. The dollar index (DXY), which compares the dollar to other global reserve currencies, noted a strong increase on Thursday, approaching monthly highs. Bitcoin, typically having an inverse relationship with the dollar, began to weaken following the dollar’s rise, resulting in a price drop below $27,000. In the last 24 hours, its price has fallen by 4%, leading to the liquidation of $50.4 million in future orders, as per Coinglass data. Almost 85% of these liquidations were for leveraged-long traders.
As a result, the entire crypto market reported a 3% loss, with total liquidations reaching $143 million. Following Bitcoin, Ethereum traders faced liquidations of approximately $30 million, while PEPE traders experienced just over $72 million in liquidations. Ethereum’s value likewise decreased by 3.4%, falling below the $1,800 mark for the first time since March 28. Meanwhile, PEPE, the increasingly popular meme coin, lost over 23% in value overnight.
The Organization of the Petroleum Exporting Countries (OPEC) expressed concern in their monthly report about the ongoing U.S. debt ceiling crisis. The debt ceiling, a pre-set limitation on how much the U.S. Treasury can borrow, has already exceeded its limit of $31.4 trillion. This may result in a default on payments, such as government bond interest obligations and other social benefits, as early as June. OPEC’s report mentioned, “In addition, the U.S. debt ceiling issue has so far not been resolved, a matter that could have economic consequences.”
The decision to raise the debt ceiling has been deferred to next Thursday, after the U.S. government failed to do so this week. Furthermore, Bitcoin’s network usage, which recently spiked due to Ordinals, has begun to cool. This is evidenced by the decrease in pending Bitcoin transactions and a significant reduction in the trading volume of Bitcoin Ordinals. Data analyst Domo’s dashboard on Dune demonstrated a decline of more than 50% on May 11 compared to the previous day, corroborating the slowdown in Ordinals trading.
While these events may seem troublesome, it is important for crypto enthusiasts to remain focused on the potential advantages of blockchain technology and its various applications. Efforts to educate others on this technology, as well as the latest market trends and safety measures, can help to foster a thriving and informed community.
Disclaimer: The views and opinions expressed by the author are for informational purposes only and do not constitute financial, investment, or other advice.
Source: Decrypt
