Market Wrap: Bitcoin Plunges to $30.3K as Options Traders Bet on Sub-$800 Ether –

Bitcoin’s plunge to as low as $30,305 was intensified from leveraged long derivative liquidations; options traders are totally bearish on ether, the native asset of Ethereum.

Bitcoin’s price crumbled over the past 24 hours, going from $38,947 at 22:00 UTC (5 p.m. ET) Sunday to as low as $30,305 by 17:00 UTC (12 p.m) Monday, according to CoinDesk 20 data. In a span of 19 hours, the world’s oldest cryptocurrency fell by $8,642, a loss of over 22%. Since then the price has risen slightly but not by much, at $33,277 as of press time. 

Read More: Bitcoin’s Big Drop Again Coincides With Dollar Bounce in Forex Markets

“Bitcoin is seeing a retracement of its steep move up, something that I am sure some traders welcome, having felt they missed the opportunity to add into weakness,” noted Katie Stockton, and analyst for Fairlead Strategies.

Stockton still stands by her prediction last week that bitcoin’s “support” level is somewhere below $25,000, where she expects traders to flood the market with buy orders and  prop up the price. “It is difficult to discern where support will ultimately be discovered with several levels of importance starting with $25,000, but it is not likely to happen immediately given still-overbought conditions.” 

The derivatives market exacerbated bitcoin’s tumble, according to Jason Lau, chief operating officer for San Francisco-based cryptocurrency exchange OKCoin. “The overall market correction was perpetuated by a long squeeze on highly leveraged derivatives positions,” Lau told CoinDesk. 

According to data aggregator Bybt, Sunday was by far the largest liquidation day in three months, with Binance alone processing over $500 million in long liquidations, the cryptocurrency version of a margin call.

Yet, bitcoin’s sell-off is not necessarily a bad thing for the cryptocurrency, according to some market observers. 

“Today’s drop should be seen as a healthy correction by smart institutions [that] bought BTC from $20,000 on the way up to $30,000,” noted David Lifchitz, chief investment officer of quant firm ExoAlpha. ”One worrying sign that we have discussed with our investors was not that bitcoin price was rising but its velocity, the speed at which it did move and the amplitude of the daily moves.”

Indeed, as bitcoin makes huge price gains and subsequent losses as happened on Monday, the volatility factor in the market is…