Bitcoin dropped to $17,567 on June 18, its lowest level since November 2020. The drop below $20,000 was the first occasion in Bitcoin’s short history that it breached the all-time high made during the previous bull market cycle. Traders fear that if Bitcoin starts to trade below $20,000, it could lead to margin calls and forced liquidations. Jeffrey Gundlach, CEO of DoubleLine Capital, expects Bitcoin to drop to $10,000.
The selling is not limited to cryptocurrencies, United States equities markets also plunged sharply last week. The S&P 500 fell 5.8% to its worst level since March 2020 and the Nasdaq Composite dropped 4.8%. Both the indices are in bear market territory. The S&P 500 is down 23% from its all-time high while the Nasdaq is off 33% from its record high.