Bitcoin's brief sub-$41k plunge triggered 'buy the dip' social sentiment

Bullish outlooks prevailed on crypto social media as proponents encouraged tapping price dips even as Bitcoin fell over 10% in a single day

According to blockchain data provider Santiment, the number of “buy the dip” calls on platforms like Telegram, Reddit, Twitter, and 4chan skyrocketed beyond a 323 level not seen since March 2022.

Buy the dip social volume and Bitcoin’s USD price | Source: SantimentBuy the dip sentiment surged following a sharp drop in the price of Bitcoin (BTC), crypto’s top token by market cap. BTC’s short nosedive below $41,000 reportedly flushed out many leverage positions, with over $700 million in long liquidations in 24 hours

The broad market decline was supposedly caused by a Matrixport report, which surmised that the U.S. Securities and Exchange Commission (SEC) might reject all spot Bitcoin ETF bids in January. However, it didn’t take long before crypto traders tagged the news as fear, uncertainty, and doubt (FUD) and deployed capital toward predicted price increments

As crypto.news reported, Deribit saw significant interest in $50,000 BTC call potions set to expire by Jan. 26, nearly two weeks after industry experts foresee approval for at least one spot BTC ETF by Gary Gensler’s SEC

Multiple meetings between issuers and the securities regulator have cushioned the bullish sentiment, and on Jan. 3, the SEC held emergency meetings with Nasdaq and the NYSE to discuss BTC ETFs, which could translate to listings on major exchanges by the second quarter of this year.

Meanwhile, Bitcoin has recovered from its retrace and exchanged hands above $44,000 on Jan. 4 as issuers like Fidelity, Grayscale, and VanEck submitted Form 8-A filing. This form signals securities registration with the SEC, which is procedural before bringing an ETF to market.

Bitcoin’s price on Jan. 4 after Matrixport post | Source: TradingView