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• Bitcoin fell to as low as $58,884.75 on Wednesday, a week after the trading debut of the bitcoin-linked ETF
• The dip in bitcoin’s price coincides with a surge in a new meme coin, shiba inu
Bitcoin fell by nearly 6% on Wednesday after the anticipation surrounding the trading debut of the bitcoin-linked exchange-traded fund (ETF) waned this week.
Bitcoin fell to as low as $58,884.75 at about 3 AM ET on Wednesday. The second-largest cryptocurrency, ether, also fell 5% to $4,006.53.
Data from Coindesk shows that Bitcoin is down 12% from last week’s record high of $66,975.
Analysts attributed the pullback to an over-leveraged market and predict more downside volatility in the offing. The estimated leverage ratio (ELR) is about to hit its peak this year.
Cryptoquant Data Guide states that ELR for a derivative exchange tells us how much leverage is used by users on average. It measures traders' sentiment whether they take a high risk or low risk. If the ELR value is high compared to the last couple of days, it indicates traders are quite confident in their positions. It is defined as the ratio of open interest divided by the amount of reserve of an exchange.
As per CoinDesk, the current ELR is 0.19, the highest since November 2020.
Arrival of a new meme coin
The dip in bitcoin’s price coincides with a surge in a new meme coin, shiba inu, which is a spinoff of the popular joke currency Dogecoin. Shiba inu has surged 28% in the last 24 hours, according to data from CoinGecko.
Coindesk reported that shiba inu has overtaken bitcoin’s position as the top traded token in the Indian rupee market this week, generating a volume of $489 million.
(With inputs from Coindesk)