Bitcoin's recent plunge to $59,100 has left investors at a crossroads: should they seize the opportunity to buy the dip, or brace for a further decline to $50,000? The crypto market is in turmoil, with Bitcoin facing heavy sell-offs and spot Bitcoin ETFs losing money, adding to the uncertainty. Data from Santiment reveals that BTC has hit a two-month low, dragging altcoins like Ethereum and Solana down with it. Amidst this volatility, some see a buying opportunity, while others advise caution. As Bitcoin's price teeters, the question remains: will it rebound to $70,000, or continue its descent?

Bitcoin Faces Heavy Sell-offs

The crypto market is undergoing an intense selloff as Bitcoin fell back to the $50,000 range. Part of the concern is that spot Bitcoin ETFs have continued to lose money, impacting prices.

Bitcoin (BTC) continues to see a substantial decline in its price, falling to $59,100 in the early hours of Thursday. For most BTC investors, the burning question is whether or not to buy the dip or wait for a further drop to $50,000 or a surge to $70,000.

Data Insights from Santiment

Data from Santiment, an on-chain analytical platform, shows that BTC has faced many challenges over the past two months.

"Bitcoin has now fallen to a 2-month low, with most altcoins faring far worse. With many traders buying the dip when BTC was nearing $60K, longs have been liquidated aggressively the last couple hours. This goes for other top caps like Ethereum and Solana as well." - Santiment (@santimentfeed) July 4, 2024

During this time, the leading digital asset faced massive liquidations, leading to a drop in its price. Altcoins, including Ethereum (ETH) and Solana (SOL), also experienced a similar drop in their price. Per Ethereum, the cryptocurrency plummeted to $3,200, despite expectations of a bull run, following the scheduled launch of spot ETFs by July 15.

Nonetheless, Santiment reported that crypto enthusiasts see the current price drop as an opportunity to buy the dip. The firm, however, advised investors to wait out initial steam before making further purchases. Santiment believes the best time to buy cryptocurrencies is when traders become impatient and skeptical.

The firm cited an instance of many traders buying the dip when BTC fell to $60,000, shortly after massive sell-offs from long positions. This pattern was also followed by Ethereum and Solana, which recorded even worse liquidations than BTC.

Santiment added that altcoins with extremely low funding rates are the best to buy right now. The firm highlights Balancer (BAL), Chromia (CHR), and Celer (CELR) as projects with heavy shorting on the Binance exchange in the last 24 hours. The firm’s sentiments are based on the premise that short liquidations lead to price increases.

Bitcoin Whale Loses $20M

The recent volatility in the Bitcoin market has resulted in a whale investor losing approximately $20 million. According to the details from on-chain data provider Lookonchain, a major Bitcoin whale or institution recently deposited 1,800 BTC (roughly $106 million) on Binance.

"The whale deposited 1,800 $BTC($106M) to #Binance at a loss again 40 minutes ago. He has deposited 5,281 $BTC($323.2M) to #Binance since June 27, with a loss of ~$20M!" - Lookonchain (@lookonchain) July 4, 2024

This whale investor has been on a buying spree, accumulating 5,281 BTC ($323 million) on the exchange over the past week at an average price of $61,196. Despite their sizable holding now at 6,068 BTC ($358 million), the investor reportedly took a $20 million hit in their latest trade.

Spot Bitcoin ETFs Continue to Lose Money

On the flip side, spot Bitcoin ETFs have continued to lose money. Daily net outflows on Wednesday, July 3, reached $20.5 million. Grayscale’s GBTC led the outflow parade with $27 million, while Fidelity’s FBTC stood out as the outlier bright spot with inflows of $6.5 million. All other ETFs remained on the sidelines with zero inflows on Wednesday.

Meanwhile, BTC continues to see a further decline in its price. At the time of writing, BTC is trading at $57,702, demonstrating a 5% drop over 24 hours. The trading volume increased by 58.5% to $36 billion, with the market cap standing at $1 trillion.

Market Sentiment and Future Predictions

The Bearish Perspective

The bearish sentiment in the market is palpable. Many analysts believe that the current market conditions could lead to a further decline in Bitcoin's price. The ongoing sell-offs, coupled with the lack of substantial inflows into spot Bitcoin ETFs, suggest that the market could see BTC dipping to $50,000.

The Bullish Perspective

On the other hand, some market experts are optimistic about a potential rebound. They argue that the current price levels present a buying opportunity, especially for long-term investors. The belief is that once the market stabilizes and the initial panic subsides, Bitcoin could see a surge back to $70,000.

Key Factors to Watch

Several key factors will play a crucial role in determining Bitcoin's future price movements:

1. Institutional Inflows: The level of institutional investment in Bitcoin will be a significant determinant. Increased inflows from institutions could provide the necessary support for a price rebound.
2. Regulatory Developments: Any positive regulatory news, especially regarding Bitcoin ETFs, could boost market sentiment and drive prices higher.
3. Market Sentiment: The overall sentiment in the crypto market will also influence Bitcoin's price. A shift from bearish to bullish sentiment could trigger a buying spree, pushing prices up.

Altcoins in the Spotlight

Ethereum (ETH)

Ethereum has not been spared from the recent market downturn. The cryptocurrency plummeted to $3,200, despite expectations of a bull run following the scheduled launch of spot ETFs by July 15. However, Ethereum's strong fundamentals and upcoming upgrades could provide a cushion against further declines.

Solana (SOL)

Solana also experienced a significant drop in its price. The cryptocurrency has been under pressure due to the broader market sell-off. However, Solana's robust ecosystem and growing adoption could help it recover once the market stabilizes.

Other Altcoins

Santiment highlighted several altcoins with extremely low funding rates as potential buys. These include Balancer (BAL), Chromia (CHR), and Celer (CELR). The firm believes that these projects, which have seen heavy shorting on the Binance exchange, could see price increases due to short liquidations.

Conclusion

The crypto market is currently in a state of flux, with Bitcoin's price movements being closely watched by investors. The recent plunge to $59,100 has raised questions about whether to buy the dip or