Bitcoin touched 43,000 at one point. Dogecoin went below 22 cents. Ethereum dropped to 3000.
What the hell happened?
First, El Salvador has officially declared Bitcoin a legal tender. That topic is in trend, but despite the hype, Bitcoin has collapsed and dragged the entire cryptocurrency market with it.
The most probable reason for that was the manipulation by Wall Street, which prevented the short squeeze. Here's what's going on.
Currently there are more paper claims to bitcoin than actual bitcoin because of leverage, margin and
futures trading. Here we can see a great liquidation of "long" positions. That led to a chain reaction and that is why the price dropped so abruptly and a lot. As soon as the decline started, I wrote a tweet about why the price dropped sharply, to help you avoid panic sales. Because with such sudden falls, the price quickly returns to the top, although almost never to the level it was before the fall. In any case, the panic sale at the bottom is a sure loss.
Now, Wall Street is in Bitcoin and they are applying a debt-based activity to an equity-based money system. Therefore, Bitcoin is heavily rehypothecated.

Rehypothecation is a practice where banks and brokers lend client assets that have been posted as collateral. In the case of bitcoin loans, many bitcoin loan providers take their clients’ bitcoin, which serves as collateral to a dollar denominated loan, and lend those assets out to third parties.
If you are interested in learning more about this, I will leave a link to the unchained-capital site, below in the description.
This simply means that, because of all this lending and borrowing, there is a much larger number of bitcoins owned, on paper, than there are bitcoins in reality.

When brokers lend bitcoins, on paper, more than there are in reality, and then the one who borrowed them sells those bitcoins in short sale, the problem we have in the last few weeks comes up.
Short sellers apparently expected the price to fall and then buy bitcoins at a lower price and return them to the lender. The price did not fall, but grew more and more, and it began to be a threat to short sellers, who would have to buy bitcoins at any price in order to return them.

Despite the initial expectation of banks and other institutions that the price will continue to fall and that the bull market is over, due to the situation with the pandemic, excessive printing of money all over the world caused inflation high enough that people started putting their fiat money in Bitcoin. Here we can see that many investors expect the price to rise, so they have opened "long" positions.
So, with this kind of bull sentiment, there was a great danger that there would be a classic run on the bank for bitcoin, and enough bitcoin simply does not exist in circulation.

Why do I think it is Wall Street, or why do I think it is the institutions that performed this manipulation. This is simply because it took a lot of money to cause such a decline without any political or regulatory reason, that is, without some bad news coming from the governments.

More on rehypothecation:
https://unchained-capital.com/blog/ultimate-guide-bitcoin-loans/


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