Bitcoin's recent 7% price decline, dropping to $64,086, has resulted in losses of $256 million for traders holding long positions. Despite escalating geopolitical tensions in the Middle East, analysts consider this drop to be within the realm of normalcy.

Benjamin Cowan mentioned in an April 13 post that similar drops of 20-22% have occurred during this cycle. MicroStrategy CEO Michael Saylor even stated, "Chaos is good for Bitcoin." Pseudonymous trader Rekt Capital believes Bitcoin will resume its upward trend after experiencing short-term pain, stating, "Bitcoin will retrace deep enough to convince you that the Bull Market is over."

Bitcoin hit a low of $60,919 on April 13 before bouncing back to $63,858. The sudden drop led to $319.15 million in liquidations from leveraged positions, including $256.58 million from long positions and $62.58 million from short positions.

Traders are preparing for further downside, with short positions totaling $1.05 billion facing liquidation if Bitcoin were to revert to its $67,000 price from 24 hours ago. The fear and greed index currently stands at a greed level of 72, down slightly from last week's extreme greed score of 78.

The global crypto market cap has dropped 8% to $2.23 trillion. Despite this, demand from Bitcoin whales has never been stronger, exceeding the market supply of new Bitcoin for the first time. This scarcity is expected to increase further after the Bitcoin halving.