In a readjusting market expectation for Federal Reserve rate cuts in 2025, investors pulled out a record 680 million dollars from Bitcoin exchange-traded funds (ETFs) on Thursday. This was the biggest single-day withdrawal since these ETFs were approved by the Fed. investment funds.
Grayscale and Bitwise Bitcoin ETFs experience a 8% decline
Bitcoin ETFs were hit by this massive outflow and the price dropped another 5%, closing the week at around $97,000. This sell-off coincides with the general decline in risky assets, which was triggered by Fed’s updated economic projections Released earlier in the week.
In contrast to the previous four rate reductions expected by the US central bank at its meeting in September, the US central banks now expects just two cuts of a quarter point each.
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Since the Fed released its new guidelines, notable Bitcoin ETFs have seen declines in value of around 8%. Bitcoin has also lost approximately 9% during the same period.
The outflows on Thursday broke a string of 15 consecutive days of inflows The twelve US Bitcoin ETFs saw a total net flow of $5.3 billion over this time frame.
On Thursday, the top cryptocurrency on the market fell under the $100,000 mark after reaching a new record high earlier this week of just above $108,000. Before the recent recovery which is around $100,000 it dropped all the way down to $92,000.
When you are looking for a way to improve your life, bearish sentiment In addition to being influenced by the Fed’s prudent stance on the markets, the seasonal profit-taking of institutional investors who own Bitcoin ETFs is likely also a factor.
Analysts alert to continued Crypto sell-off
Market sentiment could be further affected by recent sales pressure. noted Joseph Dahrieh, principal managing director at Tickmill.
“This decline could weigh strongly on the cryptocurrency and broader market sentiment, particularly as Bitcoin fell below the USD 100,000 mark, indicating potential short-term volatility and downside risks,” “He remarked.”
Massive fluctuations have exacerbated the volatility. liquidations In a 24 hour period, over $240,000,000 was traded in long and short positions. Antonio Di Giacomo is a senior analyst with XS.com. “The Federal Reserve’s cautious stance in signaling fewer cuts for 2025 created an atmosphere of doubt and speculation.”
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The cryptocurrency market is likely to continue its decline in the short term. Alex Kuptsikevich of FxPro speculated the market cap of all cryptocurrencies would drop to below $3 trillion. It had peaked at $3.7 trillion in early this month.
He warned that “a failure of less than $94,500 could signal the breakup of the uptrend of the last six weeks, while a fall below $92,000 would bring the price under the 50-day moving average. In this case, time is playing on the side of the bears.”
Bitcoin is currently trading at $97.400, even though it has lost 4% in the last 24 hours.
Chart from TradingView.com, image is from DALL.E
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Source: www.newsbtc.com
