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Coin dropped Bitcoin to more than 20% since the launch of the first exchange-traded funds that invest directly in cryptocurrency on January 11, amid traders’ caution about the potential impact of new investment products.
The digital currency rose to $49,021 on the day ETFs were launched from issuers including BlackRock and Fidelity Investment.
to retreat
Bitcoin’s price fell to $39,114, at the time of writing this report, from $49,021 on the day ETFs were launched from issuers including BlackRock and Fidelity Investments. Thus, the currency lost about 20.2% of its value in 12 days.
Bloomberg quoted analysts at the Stock Exchange Cryptocurrencies “Bitfinex,” they wrote in a note that while there appears to be widespread expectations for a decline in the cryptocurrency, it may fall to between $38,000 and $36,000.
The ten Bitcoin ETFs have recorded a total of $1.1 billion in net inflows so far this month, according to Bloomberg data as of yesterday.
These inflows include Grayscale’s Bitcoin Trust, which has seen nearly $3.5 billion in outflows so far as investors sold long-held stakes.
“Over the past two weeks, Bitcoin has been challenged by more difficult market conditions, represented by rising interest rates and the dollar, and significant selling pressure from traders,” Bloomberg quoted Sean Farrell, head of digital asset strategy at Fund Strat Global Advisors, as saying in a note.
2023 performance
Bitcoin has risen nearly 160% in the past year, outperforming traditional assets such as stocks, amid speculation that ETFs will stimulate wider adoption of the cryptocurrency by institutional and individual investors.
Supporters of Bitcoin expect that its “classification” will limit the growth of its supply, which will raise its price.
The Bitcoin halving is an event in which the reward for mining and verifying new blocks is reduced to 50%, and thus miners will be able to earn only half the number of Bitcoin tokens for each mined block. The halving operations are scheduled to take place approximately every 4 years, according to the Binance platform.
The dominant cryptocurrency is still trading well below the November 2021 record of about $69,000.
Ethereum fell by 7.225% to $2,196, at the time of preparing the report, while BNP fell by 4.75% to $295.34.
