- Bitcoin’s price dropped by over $10,000 in a week amid unfair policies and market instability.
- The Federal Reserve’s high rates have shifted cryptocurrency investment away,, contributing to Bitcoin’s current market trend..
- High outflows from Bitcoin ETFs have triggered the price drop, pushing Bitcoin below $60,000.
Just over a week, Bitcoin has recorded a notable price fall totalling to more than $10,000. The fall has sent a shockwave to the investors of digital assets.
Bitcoin shifted from $70,000 to under $60,000 in just seven days. The stable cryptocurrency market was hit once again this week from different sides with many reasons have being behind the recorded fall and they include:
1.Regulatory Crackdowns Increase Pressure on Bitcoin
Bitcoin’s value has lost its price value due to the current regulations around the world. Governments and financial institutions are regulating cryptocurrencies, with concerns like illegal activities and consumer protection.
Countries like China have shown their efforts to control Bitcoin mining and trading, causing a direct effect on its global value. The U.S. The Securities and Exchange Commission (SEC) recorded unfair policies in Bitcoin related financial products. Such policies create uncertainty in the market, leading to reduced investor confidence and price drops.
2. Weak US Economy
Bitcoin surged by $3,000 on Monday to $70,000 limit for the first time since early June. This came just a day or so after Donald Trump’s appearance at the 2024 BTC conference in Nashville.
Being pro-bitcoin and crypto now, his words had a positive effect on the entire market, but that was short-lived. Later on Monday, BTC fell by $4000, and it kept falling at the end of the week with the cryptocurrency falling to $62,200 on Friday evening.
However, BTC and the altcoins were dominated by bears during the weekend. The largest digital asset fell to a 3-week low of just under $60,000, thus losing over ten grand in less than a week.
3. Fed’s Next Move
Recently, the Bank of England lowered the interest rates in the country by 0.25 points. However, the US Federal Reserve has not taken such a move and the rates are reading at 5.25% to 5.50%. Lower interest rates are generally seen as bullish for assets like crypto as they make borrowing cheaper.
4. ETF Outflows
As reported on Saturday, the outflows from the spot Bitcoin ETFs levelled up to almost $240 million on Friday – the highest in about three months. The withdrawals from the Ethereum ETFs continued to be in the red for a second consecutive week.
The ETF flows have proven in the past that they could have an immediate impact on BTC’s price, especially the outflows. Consequently, they could be a major reason behind the asset’s fall to and below $60,000.
According to CoinMarketCap, Bitcoin is currently trading with a price value of $57,742.14 recording a 4.83% decrease at the hour of writing in the last 24 hours.