The sudden downturn led to liquidations totaling $200 million across the entire crypto market in the past four hours, according to Coin Engineer’s analysis of Coinglass’ data.

Long positions accounted for approximately 83% of these liquidations.

This dip also resulted in a shift towards bearish sentiment among the majority of BTC derivatives traders.

Moreover, the Long/Shorts Ratio dropped sharply below 1 in the hours leading up to the current time, indicating a notable increase in bearish leveraged positions.

The decline followed a weak start to the week for Bitcoin spot exchange-traded funds (ETFs).

On April 1st, ten new investment avenues, tracking the spot prices of the world’s largest digital asset, experienced net outflows totaling $85 million, according to data from SoSo Value, as observed by Coin Engineer.

The downward pressure was further exacerbated by stronger-than-expected data from the U.S. manufacturing sector, as noted by Shivam Thakral, CEO of Indian cryptocurrency BuyUcoin, in a conversation with Coin Engineer.

Traditionally, risk-based markets such as cryptocurrencies and equities interpret such events as indicating a reduced likelihood of the U.S. Federal Reserve cutting interest rates.

This development also led to declines in Wall Street’s main indices, such as the S&P 500 and Nasdaq Composite.

Despite this, Thakral emphasized that the crypto market typically experiences “significant volatility” leading up to Bitcoin’s halving. Therefore, participants should expect further fluctuations over the next two weeks.

At the time of writing, market sentiment was characterized by “extreme greed,” according to data from Hyblock Capital. This could potentially drive increased buying pressure in the coming days, aiding Bitcoin’s upward momentum.

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