Major digital assets have seen a significant decline over the last 24 hours, with Bitcoin leading the downward trend. Investors recorded losses as large as 8% as Bitcoin, Ether, Cardano's ADA, and BNB Chain's BNB faced a wave of selling pressure propelled by the rise of the US dollar. This unexpected turn of events resulted in the liquidation of over $400 million in bullish positions across various token markets.

Bitcoin's value plummeted by 5%, mirroring similar losses in other prominent players such as Ether, ADA, and BNB. Solana's SOL and Dogecoin (DOGE) saw a more significant downtrend, dropping by 7% and over 8% respectively. The sell-off extended to Bitcoin Cash's BCH, down by 10%, primarily driven by profit-taking following a recent 40% surge in value, amplified by anticipation surrounding the network's upcoming halving event slated for April 4.

The widely watched CoinDesk 20 index, which monitors major tokens excluding stablecoins, witnessed a decline of just over 5%, signaling an across-the-board downturn in cryptocurrency markets. The vast liquidation of long positions—bets predicting price increases—totaling over $400 million occurred, while short positions—bets against the price—reported a relatively modest $85 million in liquidations. Liquidation events occur when traders lack sufficient funds to maintain leveraged trades open, resulting in forced closure.

According to analysts from Bitfinex, a prominent cryptocurrency exchange, recent days have witnessed long-term investors shedding portions of their crypto holdings, indicating a potential period of consolidation ahead for Bitcoin. Market experts predict Bitcoin will remain within a predictable range in the upcoming weeks due to the emergence of previously dormant supply, notably among Long-Term Holders (LTHs), although on a lesser scale compared to previous bullish cycles.

The Bitfinex analysts further elaborated on the scenario, noting, "Strategic profit-taking is evident among the LTH cohort, encompassing holders of BTC for over 155 days." Meanwhile, senior market analyst Alex Kuptsikevich from FxPro highlighted the resistance Bitcoin faces at the $71,000 mark amidst global markets exercising caution towards risky assets. Kuptsikevich pointed out that Bitcoin's attempts to stabilize above $71K have been unsuccessful, coinciding with a downward trend in the Nasdaq100 index, signaling an overall dubious sentiment towards volatile investments. He emphasized, "Bitcoin is encountering robust resistance, with keen monitoring on the $69.5K and $68.5K price levels."

Conclusively, the recent upheaval in the cryptocurrency market has shed light on the vulnerability of digital assets to external forces, with Bitcoin and major tokens experiencing sharp declines due to market dynamics and shifting investor sentiments. The liquidation of bullish positions in combination with profit-taking actions among long-term investors signifies a recalibration in the market, urging caution and vigilance among industry participants amidst the evolving landscape of cryptocurrency trading. Market participants are advised to closely monitor price movements and emerging trends to navigate the turbulent waters of cryptocurrency investment successfully.