Here’s why Bitcoin flash crashed, on-chain data still bullish

TL:DR Breakdown: Bitcoin flash crashed to $43,000 on Tuesday as El Salvador legalized it for payments.Experts explained that the drop was largely driven by the liquidations on the derivative market.Regardless, on-chain data are still bullish suggesting the uptrend may continue. In what could be seen as wrong timing, the largest cryptocurrency, Bitcoin flash crashed on Tuesday, the same day the government of El Salvador officially pronounced it as a legal tender. Not just Bitcoin, major altcoins, including Ether, Binance Coin, and Solana, etc., took a hit, which resulted in a significant amount of crypto liquidations in the derivative market. Reasons Bitcoin flash crash on Tuesday The price of Bitcoin dropped by over 11 percent from a high of $51,101 to $45,299 according to Coingecko. However, major exchanges such as Binance and Coinbase recorded as low as $42,900. Overall, the Bitcoin flash crash resulted in an 11.6 percent drop in whole crypto market capitalization, to $2.16 billion. Firstly, it’s worth noting that the incident came as a reminder of how volatile Bitcoin and other cryptocurrencies are. The market value of digital currencies can significantly increase or decrease at any given time. Besides market volatility, there were talks that the news El Salvador will legalize Bitcoin on September 7, was already priced in. People believed Bitcoin was going to increase following the news around El Salvador adoption an...