Today, at the beginning of the Asian session, the price of bitcoin fell from $43,800 to $40,272, which amounted to a drop of almost 8%. Ether also lost almost 5% of its value, dropping to $2,161, and most altcoins showed a similar trend.

This downturn caused significant liquidation of long positions on centralized exchanges. As a result of the volatility, bitcoin positions worth more than $94 million were closed, with most of this amount ($85 million) coming from long positions. According to CoinGlass, a total of $360 million worth of liquidation was recorded in the cryptocurrency market, which also led to the closure of long positions of $320 million on various exchanges.

Liquidation in the derivatives markets occurs when a trader does not have sufficient funds to cover losses and his position is closed automatically. This happens in case of adverse market movements, which leads to the exhaustion of the initial margin or deposit.

Will Clemente, a cryptanalyst and co-founder of Reflexivity Research, notes that market correction and volatility help to get rid of weak participants and reduce activity in highly indebted markets.

As for financing rates, according to CoinGlass data, they have dropped today to below +0.01% for bitcoin, ether and other cryptocurrencies, which is a decrease compared to the previous +0.1% observed in recent weeks. This indicates a decrease in interest in long positions using leverage.

Analysts remain optimistic about the future of cryptocurrencies, especially in light of the approach of 2024. Experts from the investment company VanEck predict that bitcoin will reach a new historical high in the fourth quarter of next year. This optimism is supported by expectations of an upcoming halving of the bitcoin mining reward and the possible launch of an exchange-traded fund for bitcoin.

Perhaps this is the beginning of a new wave of altcoin growth after the last decline, as crypto trader Remen claims. He believes that bitcoin will take considerable time to recover its uptrend, especially considering that bitcoin's dominance has reached its maximum.