Markets
Why is Bitcoin falling? Crypto Selloff Sends BTC Price to 6-Week Low
Top line
Bitcoin plunged Monday to its lowest price since May 13, extending the mid-year sell-off, cutting into the leading cryptocurrency’s strong returns following January’s historic approval of Bitcoin spot exchange-traded funds .
June was a down month for Bitcoin.
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Highlights
Bitcoin fell more than 4% as of 2 p.m. Greenwich Mean Time, or 10 a.m. ET, trading at around $61,550, recovering slightly from its six-week low of $60,827 set earlier Monday (cryptocurrency price movements are typically measured in GMT, as digital assets trade constantly). .
Bitcoin is now down 9% in June, but remains up 45% year to date, with gains largely concentrated around the ETF approval.
The recent losses were apparently catalyzed by early selling linked to Japan’s long-closed Mt. Gox stock exchange. imminent return of almost $9 billion in bitcoins to creditors and the German government reported selling hundreds of millions of dollars of cryptocurrency.
Other cryptocurrencies also fell on Monday, as Ether, Binance coin and Solana all fell 3.5% or more.
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Surprising fact
Bitcoin withdrawals from crypto exchanges exceeded deposits by $522 million from Wednesday to Sunday, according to FactSet data, indicating that a number of Bitcoin holders are cashing out their investments.
Crucial quote
“Crypto declines have become louder again,” Bernstein analysts Gautam Chhugani and Mahika Sapra wrote to clients on Monday. “After months of euphoria for Bitcoin ETFs, the market is suddenly feeling bearish,” continued the Bernstein Group, which maintains a very bullish price target of $200,000 for Bitcoin, expecting prices more than tripled.
Key context
Bitcoin prices have risen nearly 300% since the end of 2022, with much of its gains coming from hype around Bitcoin spot exchange-traded funds. ETFs were a crucial step in Bitcoin’s entry into the mainstream market, as traditional fund managers such as BlackRock and Fidelity created low-fee funds allowing investors to invest directly in the price of Bitcoin through traditional brokerage houses, without having to go directly to cryptocurrency exchanges. buy bitcoin. Bitcoin is from afar the most valuable cryptocurrency, with a market capitalization of $1.2 trillion.