#write2earn #BITCOIN FACES TURBULENCE: #ETF DEMAND WANES AMID FED UNCERTAINTY #bloodbath #bitcoinETF
Bitcoin took a dive to its lowest point in two weeks, but then managed to recover some losses as interest in dedicated US exchange-traded funds dwindles and investors start questioning how fast the Federal Reserve can slash interest rates.
Since hitting a record high of almost $73,798 on March 14, the digital currency has been on a downward trend, raising doubts about whether itâs hit its peak for now. Bitcoin dropped by as much as 4.6% before stabilizing around $63,350 on Wednesday.
The excitement around US spot-Bitcoin ETFs, which were launched with great hype on January 11, has cooled off. While these products saw a net inflow of $11.7 billion overall, they experienced their largest outflow on Tuesday.
The exit from the Grayscale Bitcoin Trust led to a $326 million outflow, while subscriptions dwindled for similar offerings from companies like Fidelity Investments and BlackRock Inc., according to Bloomberg data.
Bitcoinâs decline is happening as uncertainty looms over whether the Fed will adjust its rate-cut projections due to higher-than-targeted inflation. This uncertainty doesnât bode well for speculators.
Tony Sycamore, a market analyst at IG Australia Pty, noted that some latecomers who bought in above $60,000 are now facing a reality check, especially those who expected a continuous influx into the new Bitcoin ETFs.
The broader crypto market has shed around $460 billion since reaching $2.9 trillion last week, according to CoinGecko. Tokens like Ether, BNB, and even the meme-favorite Dogecoin are all seeing losses.
The liquidation of bullish bets using derivatives could prolong, potentially hindering a quick recovery in the digital asset market, as suggested by K33 Research.
K33 Researchâs Anders Helseth and Vetle Lunde highlighted the substantial liquidation of about $511 million worth of bullish crypto wagers in the past 24 hours, indicating significant downside volatility.
