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Amid a broad correction in market expectations of an interest rate cut by the Federal Reserve (Fed) in 2025, investors withdrew a record $680 million from Bitcoin ETFs on Thursday, the highest single-day outflow since the January approval of these items. investment funds.
Grayscale And Bitwise Bitcoin ETFs Drop 8%.
As the Bitcoin ETF faced this exit, the price fell, dropping another 5% to trade around $97,400 to close the week. The sale is accompanied by a general decline in risk assets, caused by the Fed’s. revised economic estimates released earlier this week.
The US central bank now expects only two rate cuts per quarter next year, a significant drop from the four cuts expected at its September meeting.
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Notable Bitcoin ETFs, including Grayscale’s Bitcoin Trust and Bitwise’s Bitcoin ETF, have experienced declines of around 8% since the Fed’s new guidance, while Bitcoin itself has lost around 9% over the same period.
Notably, Thursday’s outing broke the streak 15 consecutive days of entry with twelve US Bitcoin ETFs, with revenues of approximately $5.3 billion during this period.
After hitting a record high of just over $108,000 earlier this week, the top cryptocurrency in the market fell below the $100,000 mark on Thursday. Before the recent recovery, which was around $100,000, it dropped to $92,000.
While i bearish sentiment in the market may be due to the Fed’s cautious stance, and it may be influenced by occasional profit-taking among investors of Bitcoin ETF institutions.
Analysts Warn of Continued Crypto Sell-Off
Recent selling pressure may further drive market sentiment, as noted by Joseph Dahrieh, managing principal at Tickmill.
“This decline could weigh heavily on cryptocurrency and broader market sentiment, especially as Bitcoin falls below the USD 100,000 mark, indicating potential short-term volatility and downside risks,” he said.
Volatility has been rampant termination for both long and short positions, totaling more than $240 million within a 24-hour period. Antonio Di Giacomo, senior market analyst at XS.com, commented, “The cautious stance of the Federal Reserve in indicating fewer cuts in 2025 has created an atmosphere of doubt and speculation.”
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Looking ahead, the sell-off in the cryptocurrency market may continue in the near term. Alex Kuptsikevich, chief market analyst at FxPro, estimated that the total market value of cryptocurrencies could fall below $3 billion, down from a peak of $3.7 trillion earlier this month.
He warned that “a failure below $94,500 will signal the separation of uptrend over the past six weeks, and a drop below $92,000 would bring the price below the 50-day moving average. This time, time is on the side of the bears. “
As of this writing, Bitcoin has managed to stabilize above $97,400 as the week draws to a close, despite registering a loss of 4% in the last 24 hours.
Featured image from DALL-E, chart from TradingView.com
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