The crypto market faced a major shake-up after over $1 billion was liquidated within just 24 hours, catching traders off guard. This downturn comes on the heels of a strong upward momentum over the past 30 days, leaving many unprepared for the sudden change.

Swyftx lead analyst Pav Hundal described the situation as "indiscriminate selling" brought on by the market’s recent bullish sentiment. He reassured investors, calling it a phase of “short-term angst” rather than the end of positive trends. Hundal expressed hope for a potential "Santa rally" as the year progresses, maintaining optimism about market recovery.

Bitcoin, a key indicator of market health, dropped 3.36% to trade below the crucial $100,000 mark, sparking further liquidations. Data showed that $856.66 million of the liquidations were from long positions, a trend that has been recurring throughout December. Earlier in the month, Bitcoin’s brief fall below $93,000 wiped out $300 million in minutes, and a similar event on Dec. 10 resulted in $1.7 billion liquidated within a day.

Fred Krueger, a Bitcoin advocate, warned against the perils of leveraged trading, emphasizing that such events highlight its risks. Meanwhile, other analysts remain confident. Caleb Franzen pointed out that pullbacks are common during bull runs, citing similar patterns in previous cycles where recoveries led to higher highs.

The anticipation surrounding Donald Trump’s upcoming administration is adding another layer of uncertainty. Analysts predict market volatility as traders adjust their expectations ahead of his inauguration in January 2025, particularly regarding his potential plans for a U.S. Bitcoin reserve.

Despite the recent turbulence, the consensus among experts suggests that the market may soon stabilize, and investors should remain optimistic about long-term trends.