Emmanuel OchayiBitcoin Faces Significant Losses
The cryptocurrency market is experiencing increasing losses following Bitcoin’s second-worst weekly decrease in 2024.
This decline is attributed to the waning demand for Bitcoin exchange-traded funds (ETFs), ambiguity surrounding the U.S. Federal Reserve’s monetary policy, and a weak appetite for digital assets, marking the sharpest decline since April.
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Bitcoin’s price dropped by almost 5% to $61,000, hitting a one-month low. A six-day run of withdrawals from US ETFs dedicated to the digital asset has battered the top token by market value.
John Doe, a cryptocurrency analyst, explained, “The continuous outflows from Bitcoin ETFs are a clear sign of the diminishing confidence among investors. This has put significant downward pressure on Bitcoin’s price.”
ETFs Withdrawals and Market Impact
In the last 24 hours, 90,987 dealers were liquidated, resulting in a total liquidation value of $283.23 million. Crypto market failures coincide with skepticism about the Federal Reserve’s ability to swiftly lower interest rates following a two-decade peak.
READ ALSO: Bitcoin, Ethereum Prices Rebound Following Interest Rate Uncertainty In U.S.
“The uncertainty around the Federal Reserve’s policies is making investors cautious,” said Jane Smith, an economist. “They are pulling out of risky assets like cryptocurrencies, leading to the current downturn.”
Other Cryptocurrencies Affected
Some areas have seen particularly noteworthy drops: Ether and Solana have experienced their longest weekly falls since last year and 2022, respectively.
Ethereum, at $3,312, is down about 5% from the previous day and 8% from the past week. This is despite recent reports of substantial long-term holder accumulation during the price decline.
Farside data highlighted that ETFs tracking Bitcoin have seen a series of withdrawals over the last six trading days. On June 13, there were outflows of $226.2 million, the most significant of the six days.
Broader Market Impacts
The global crypto market valuation currently stands at $2.24 trillion, a 4.54% decrease over the last day. Bitcoin’s dominance is currently 53.85%, a decrease of 0.19% amid high sell-offs in the altcoin market.
Major cryptocurrencies including Polkadot (DOT), Solana (SOL), and Ripple (XRP) are reporting daily decreases ranging from 5% to 12%, indicating that the broader altcoin market is also in the red.
Shiba Inu Volatility
Shiba Inu, one of the meme coins, has dropped approximately 9% in the last 24 hours and nearly 20% in the past week, making it one of the most volatile meme coins.
The last few days have seen a slowdown in Bitcoin whale transactions, just before the price of the cryptocurrency fell below $61K. Data from Sentiment shows there were 9,923 Bitcoin whale transactions (those worth more than $100,000) in total during the previous two days on June 23. This represents a 42% decline from the 17,091 transactions reported in the two days prior.
Future Outlook
Traders had been bullish on digital assets earlier this year, anticipating a dovish turn from the Federal Reserve as inflation recedes, along with a political shift in Washington that might signal a friendlier attitude from U.S. regulators. However, the current market conditions have dampened those expectations.
“Investors were hopeful that regulatory and monetary policies would become more favorable,” noted Chris Lee, a financial strategist. “But the recent developments have shattered those hopes, at least in the short term.”
The cryptocurrency market continues to face significant challenges, with Bitcoin and other major digital assets experiencing sharp declines.
The future remains uncertain as investors navigate the complex landscape of regulatory policies and market dynamics.
Emmanuel Ochayi is a journalist. He is a graduate of the University of Lagos, School of first choice and the nations pride. Emmanuel is keen on exploring writing angles in different areas, including Business, climate change, politics, Education, and others.
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