Bitcoin Plunges 11%, Eyes $41k Mark: Major Correction Looming?

By Aaron Feuerstein January 19, 2024 In Bitcoin, Ethereum, Solana, XRP
Bitcoin’s price is up. Image: Shutterstock
  • Despite recent approvals for Spot Bitcoin ETFs and initial high expectations, the Bitcoin price has experienced a significant drop.
  • Some experts, like Michaël van de Poppe, view this as a potential buying opportunity.
  • Others, such as Ran Neuner, suggest that the impact of the Grayscale Bitcoin Trust (GBTC) overhang indicates a more gradual, long-term development.
  • However, market corrections, including significant fluctuations, are a normal and healthy part of the crypto trading experience.

BTC Price in Freefall – Is the Bull Run Cancelled?

It has been just over a week since the Spot Bitcoin ETFs were approved, and despite calls for ‘god candles’ and a USD $200k Bitcoin, the reality is different. BTC has plummeted twice in the past week, going from USD $46,380 (AUD $70,435) to USD $41,290 (AUD $62,700).

Bitcoin (BTC), 7-day chart, source: CoinMarketCap

Other cryptocurrencies didn’t fare much better, with altcoin season cut short, after Ethereum (ETH) fell over 5% week-on-week. Solana (down 5.75%), XRP (8.35%) and ADA (14%) all followed suit, with Cardano’s ADA receiving a negative report card and one analysis urging investors to move out of the project.

So, is the bull run cancelled? Not so fast, says senior trader Michaël van de Poppe. He posted on X, saying that the Bitcoin range below USD $41k (AUD $62.2k) presents a perfect buying opportunity. If we see a USD $36-39k (AUD $54.7-59.2k) BTC, even better.

Bitcoin ETF Doing Its Thing

Yes, many had hoped that we would see Bitcoin explode and we haven’t yet, but what many forget is that ETF investing is a long-haul game, not a quick profit-taking venture. Ran Neuner said he believes the overhang from the GBTC (Grayscale Bitcoin Trust) will have an effect on the price for a bit longer.


In other words, there’s a concern that new ETFs won’t be able to quickly mitigate the impact of the overhang by attracting enough investment to close the gap between the value of GBTC shares and the underlying Bitcoin.

Neuner mentions that if there were substantial buyers interested in these investment products, such a major asset management firm like BlackRock would have already brought them into the market. The absence of these “huge immediate buyers” indicates that such demand may not exist at the moment or that investors are cautious – for now at least.

Corrections in Crypto Part-and-Parcel, Says Expert

However, corrections are not new, and anyone who has spent some time in crypto knows they can be far more volatile and pronounced than in traditional financial markets.

Lark Davis commented on the need for crypto investors or traders to accept such volatility. A 13% correction is considered mild in crypto terms. Market participants must be prepared for extreme fluctuations, viewing them as a common aspect of the crypto experience.

Davis believes investors should have strategies to handle dramatic declines, like using stop-loss orders, diversifying assets, or adopting a long-term view to endure short-term drops. The high risk in crypto investment is countered by the potential for high returns, attracting many investors despite the need for strong risk tolerance and understanding that severe corrections are typical in crypto trading. Davis suggests that those uncomfortable with these market conditions might reconsider their involvement in the crypto market.

Aaron Feuerstein

Aaron Feuerstein

Aaron Feuerstein is a freelance writer based in Melbourne. His focus is on decentralised finance and the regulatory space surrounding blockchain. He holds a Master's in Accounting. When he is not studying the latest legal case, he enjoys his time as a modest but eager hobby cook.

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