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A tight range usually resolves with a range breakout and that is what happened in Bitcoin (BTC) on Aug. 17. Bitcoin fell sharply, resulting in a $1 billion liquidation for derivatives traders, the biggest since the FTX collapse in 2022.

It is difficult to pinpoint any specific reason for the sell-off but analysts believe that the confusion arising from the alleged write-down of SpaceX’s $373 million Bitcoin holdings may have been one of the potential triggers.

Whatever the reason, the decline has started. The next major question troubling investors is how low could Bitcoin fall. Several analysts have turned bearish and expect Bitcoin to continue its downtrend in the near term.

Will Bitcoin continue to drop, dragging the rest of the cryptocurrency markets with it? What are the important support levels to keep an eye on? Let’s study the charts of the top-10 cryptocurrencies to find out.

Bitcoin price analysis

Bitcoin’s narrow range resolved to the downside on Aug. 17, triggering a long liquidation, which pulled the price to $25,166.

Update (Aug. 18 at 2:09 pm UTC): This article has been updated with both sides’ perspectives and additional information. Further commentaries are expected from both sides.

Crypto influencer Evan Luthra has brought a lawsuit against crypto exchange Bitget for freezing his account after a new token listing in March. According to Luthra, the exchange suspended his withdrawals and froze $200,000 in Tether (USDT) while attempts to seek clarification went unanswered. 

Luthra’s involvement with the ReelStar project serves as a backdrop to these events. The influencer was hired as an adviser to ReelStar, a startup developing a social media app for creators. As compensation, Luthra was offered Reel Tokens (REELT), the project’s utility token. Upon its listing, the influencer sold 1.3 million REELT tokens on Bitget. Luthra’s account was then frozen under suspicion of market manipulation. A spokesperson from Bitget told Cointelegraph about the decision:

“Bitget faced a manipulative attack by a group of traders attempting to profit by manipulating trades on the exchange. Their target was a new coin called REELT, which they tried to dump immediately after its listing on Bitget, causing a large drop in the coin’s price.“

Additionally, Bitget claims to have contacted the crypto influencer for an explanation: “In response, he admitted to selling the tokens. However, when we asked for the reasons behind this abnormal behavior, we did not receive active feedback or satisfactory response.“

SpaceX's Bitcoin write-down report on Aug. 18  sparked confusion among the crypto community. The report published in Wall Street Journal puzzled many, who questioned whether SpaceX held $373 million worth of Bitcoin and sold it in 2021-22 or whether they only reduced their Bitcoin exposure by the same amount.

Several social media outlets reported that SpaceX had sold its entire BTC holdings while others expressed uncertainty, claiming they were unable to confirm the amount based on the wording of the report.

Elon Musk revealed in 2021 that SpaceX holds Bitcoin, as does Tesla, on their balance sheet. While Tesla’s Bitcoin holdings were made public, there were no estimations around SpaceX’s BTC holdings which has been key to the ongoing confusion. Tesla once held $1.5 billion worth of BTC purchased during the bull market, but revealed it sold 72% of its holdings in Q2 of 2022

The SpaceX write-off claims were also believed to be one of the key catalysts behind the $2000 BTC price drop, although several others denied it being a cause. Elon Musk hasn’t addressed the issue yet, but the market FUD made him a target of Bitcoin proponents who questioned his strategy of buying high and selling low while a few others called it a market FUD.

One Reddit user wrote that Musk is running out of cash across all his companies while suggesting that Musk might sell “all of his Bitcoin and doge within the next 6 months.”