June 20, 2024 (Thursday)
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The storm continues to hit the Bitcoin market, with huge outflows from spot ETFs shaking investor confidence. Around $879 million has left Bitcoin funds in a week, raising doubts about the future stability of the leading cryptocurrency. Experts say a key factor could reverse this worrying trend.
Bitcoin’s Collapse: Key Numbers to Know
Bitcoin has seen a significant drop in recent days, fluctuating between $65,500 and $64,000. This volatility is mainly due to net outflows from the US Spot Bitcoin ETF, which reached nearly $300 million in just two days. Since the beginning of last week, these net outflows total $879 million. The largest outflow was from Fidelity’s FBTC fund with $175 million, followed by Grayscale Investments’ GBTC fund with $65 million.
This selling trend intensified among institutional investors after the Federal Reserve took a tougher stance than expected. As a result, Bitcoin’s price has fallen 6% in the past seven days, shaking investor confidence. Derivatives traders have also suffered losses, with nearly $32 million liquidated in the past 24 hours, of which $20 million was from long positions.
Bitcoin Trend Reversal: Key to a Potential Recovery
According to a note from the BRN trading desk, if ETF inflows exceed outflows, Bitcoin’s trend could reverse. Currently, the trend is leaning towards selling, which continues to pressure Bitcoin’s price. BRN also noted that Donald Trump’s pro-mining stance could benefit American miners, especially with the adoption of more energy-efficient equipment.
Bitcoin miners are also feeling the pressure and are selling their bitcoin holdings to fund operations and upgrade equipment. The decline in miner reserves, combined with the drop in hash price and hash rate, suggests a decline in overall mining power. BRN analysts point out that if Bitcoin falls below the $64,000 level, it could trigger a premature bear market.
The Bitcoin market is at a critical juncture due to massive ETF fund outflows and prolonged selling pressure. Investors remain cautious and are watching closely for any catalysts for a trend reversal. Future developments will depend on miners and government policies. For now, the market remains volatile and investors should exercise caution.
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He holds a degree from Sciences Po Toulouse and is a Blockchain Certified Consultant by Alyra. In 2019, he returned to the Cointribune venture, working to expand the potential of blockchain to multiple sectors of the economy and to educate and inform the public about the constantly evolving ecosystem. My objective is to gain a deeper understanding of blockchain and seize the opportunities it offers. I am committed to providing an objective analysis of the current situation, elucidating market trends, communicating the latest technological innovations and gauging the prospects of economic and social challenges in this revolution of the market.
Disclaimer
The views, thoughts and opinions expressed in this article are those of the author and should not be taken as investment advice. Please conduct your own research before making any investment decisions.
