Bitcoin Experiences 3% Drop amid Slowing ETF Demand and Market Caution
Summary:
On April 16, Bitcoin (BTC) experienced a 3% drop, a reflection of slowing demand for ETFs. The decrease happened soon after trading began on Wall Street, with the lowest BTC price reaching $61,709 on Binance. CryptoQuant has revealed that demand growth for Bitcoin in the US ETF market has significantly slowed since its peak in March. In the meantime, despite the slump in BTC prices, Bitcoin 'whales' have retained their coins, indicating an ongoing accumulation trend. Some crypto analysts predict a consolidation of BTC pricing is necessary before reaching new all-time high levels.
On April 16, the cost of Bitcoin (BTC) experienced a 3% drop as cryptocurrency investors adopted a more cautious approach due to the slowing demand for ETFs. This occurred shortly after the commencement of trading at Wall Street, with the lowest BTC price markers standing at $61,709 on Binance. These figures were provided by Cointelegraph Markets Pro and TradingView.
The downturn wasn't limited to Bitcoin as US stock indexes also recorded a decrease, coinciding with the US dollar Index reaching a six-month peak at 106.17. A dip was also observed on April 15, with a net outflow of $36.7 million from spot Bitcoin exchange-traded funds, according to metrics from Farside Investors.
CryptoQuant Founder and CEO, Ki Young Ju, flagged that the once-striving demand for Bitcoin ETFs had leveled off over the past four weeks. An examination of the data by Farside Investors revealed that only Grayscale and BlackRock recorded ETF flows on Friday, April 12 and Monday, April 15, while all other funds registered no activity.
CryptoQuant has also unveiled a noteworthy trend, noting a significant decline in demand for Bitcoin within the US ETF market since its peak in March. Meanwhile, Cointelegraph reported that Bitcoin 'whales' retained their holdings in spite of the recent BTC exchange plunge.
This demonstrates an ongoing pattern of accumulation which is unaffected by the reduction of spot transactions. The announcement that Hong Kong had granted approval for spot Bitcoin ETF further failed to instigate a surge in BTS trading.
However, the consolidation of BTC pricing before reaching new all-time high levels has certain crypto analysts keenly watching. Among them, Tom Dunleavy, partner at MV Capital, noted that the realized value percentage of investors holding on for the long term is over 40%; considerably higher than the 10% that has typically indicated a peak in BTC's value. He adds that a continual surge in catalysts presents no cause for a prolonged pullback to occur.
CryptoQuant analysts also commented that investors' exposure to BTC has decreased leading up to Bitcoin's halving set for April 20, which may suggest that they are awaiting a reduction in Middle East tensions.
Published At
4/16/2024 11:55:46 PM
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