Bitcoin hits two-month low amid dollar strength, cooling ordinal activity
Bitcoin fell to a two-month low of $26,188 early this morning amid rising dollar strength and a cooling in Ordinals hype.
The dollar index (DXY), which measures the greenback against other global reserve currencies, registered a strong rally on Thursday, moving towards monthly highs.
Bitcoin, which usually has an inverse relationship with the dollar, began to show weakness after the dollar’s rally, falling below $27,000.
The price lost 4% in the last 24 hours, taking down $50.4 million in future order execution according to Coinglass data. About 85% of these liquidations were for long-term transfer traders.
Total losses for the entire crypto market were 3%, and total liquidations reached $143 million.
After Bitcoin, Ethereum traders were liquidated at approximately $30 million followed by PEPE traders at just over $72 million.
Ethereum also fell 3.4%, falling below the $1,800 level for the first time since March 28. PEPE, the hyper-popular meme coin, has also fallen more than 23% overnight.
Dollar rises, Bitcoin ordinals cool
The Organization of the Petroleum Exporting Countries (OPEC) yesterday raised concerns about the US debt ceiling crisis in its monthly report.
The US debt ceiling is a limit set by the government that limits how much the US Treasury can borrow. The Treasury has already breached its $31.4 trillion cap and could soon default on its payments, including interest payments on government bonds and other social benefits to citizens as early as June.
The OPEC report reads: “In addition, the US debt ceiling has so far not been resolved, an issue that could have economic consequences.”
The US government failed to raise the cap this week to give the market some room, pushing the decision until next Thursday.
The newfound spike in Bitcoin’s network usage due to Ordinals also showed signs of cooling as the number of transactions in the mempool, which represents the pending Bitcoin transactions, dropped.
Number of Bitcoin mempool transactions. Source: Glassnode.
Bitcoin Ordinals trading volume from data analyst Domo’s dashboard on Dune shows a significant drop of more than 50% on May 11 from the previous day, confirming a decline in Ordinals trading.
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