The price of bitcoin fell more than 5% Wednesday as long-term holders took some of their profits a week after the cryptocurrency hit its all-time high.
Bitcoin fell sharply at about 3 a.m. EST and last traded 4.2% lower at $58,884.75, according to Coin Metrics. The price of ether fell 5% to $4,006.53.
The move downward may come as little to surprise to investors, some of whom expected a slight pullback after the market rallied behind bitcoin as enthusiasm around the launch of the first bitcoin futures ETF from ProShares last week.
"This correction is due," said Noelle Acheson, head of market insights at Genesis. "There was much more demand in the initial days before the ETF than I expected which is good news. It has totally leveled off but we'll see what happens when the VanEck ETF starts trading and what happens over the next few days, because there are a couple more that might be that might be allowed to live."
Feeling out of the loop? We'll catch you up on the Chicago news you need to know. Sign up for the weekly Chicago Catch-Up newsletter here.
Similarly, the cryptocurrency also sold off when the Chicago Mercantile Exchange listed bitcoin futures in December 2017 and when Coinbase was listed on the Nasdaq this April. It remains to be seen if bitcoin will fall as much this time around or if it will take as long to recover, however.
Acheson also noted that leverage has come back into the market sharply and the funding rate for bitcoin has spiked.
"When you get any kind of movement with growing leverage, you get liquidation, and that's what we're seeing today," she said. "It's good news, it's flushing leverage out the market, which is very healthy."
The dip also coincides with a surge in a new memecoin, the dogecoin spinoff shiba inu, which has surged 28% in the last 24 hours, according to data from CoinGecko.