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The recent collapse of Bitcoin can be attributed to several major factors:
1. Global Economic Uncertainty: Fears over inflation, central bank interest rate hikes, and broader economic concerns are driving investors away from risky assets like cryptocurrencies and into safe havens like gold and government bonds.
2. Government Regulations: Tighter regulations, especially in the United States and other countries, are affecting investor confidence in cryptocurrencies. Announcements of potential restrictions or bans are increasing panic in the markets.
3. Massive Liquidations: Large sales of Bitcoin by institutional investors or whales (large crypto holders) cause a cascade of liquidations on the platforms, amplifying the price fall.
4. Leverage: Traders using leveraged positions may find themselves liquidated in the event of sharp moves, further exacerbating the decline.
5. Technical Factors: The break of some important technical support levels also triggered automatic selling, increasing the bearish pressure on the market.
These combined elements are creating a massive selling environment, pushing Bitcoin and other cryptos to significant lows.
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