Bitcoin, the world’s largest cryptocurrency, continues to be under some selling pressure as traders get jittery ahead of the Fed’s decision on interest rate cuts. In the last 24 hours, the Bitcoin price has tanked by an additional 2% there slipping under $68,500 levels.
Fed to Keep Interest Rates Higher for Longer Than Expected
Last week, the European Central Bank and the Bank of Canada pivoted by cutting down interest rates. However, the Federal Reserve is unlikely to initiate similar action considering the strong jobs data reported last week.
Bitcoin reached a record high of $73,798 in March, driven by inflows into dedicated US exchange-traded funds. However, it has struggled to achieve new highs since. The upcoming inflation data and Federal Reserve outlook on Wednesday could reinforce concerns that interest rates will remain elevated for an extended period, creating a challenging environment for speculative assets like cryptocurrencies. Speaking to Bloomberg, Anand Gomes, co-founder of Paradigm, a derivatives platform said:
“No news is bad news in crypto. The market is like a junkie that constantly needs bullish news to stay up. So when there is none, the path of least resistance is lower.”
More Pain Ahead for Bitcoin?
Bitcoin analyst Willy Woo has noted that Bitcoin is currently experiencing a rare miner capitulation, linked to the recent halving event. Woo explains that this process eliminates weaker miners, who subsequently sell off their BTC holdings. According to Woo, the price of Bitcoin typically rebounds following such sell-offs.
However, Woo cautions that before a price surge can occur, there must first be a clearing out of excessive speculative interest in BTC futures markets. “Liquidations need to happen before a pump,” he emphasized.
On the other hand, the Bitcoin ETFs recorded their first outflows after 19 consecutive days of strong inflows. On June 10, Bitcoin spot ETFs experienced a total net outflow of $64.9318 million, marking the first net outflow after 19 consecutive days of net inflows.
Grayscale ETF (GBTC) saw a significant single-day outflow of $39.5366 million. In contrast, Bitwise ETF (BITB) recorded an inflow of $7.5910 million, and BlackRock ETF (IBIT) reported an inflow of $6.3433 million.
🚨 $BTC #ETF Net Inflow June 10, 2024: -$65M!
• The net inflow turned negative after being positive for 19 consecutive trading days.
• The single-day inflow of #BlackRock (IBIT) dropped dramatically from $168M to only $6.3M.
• #Grayscale (GBTC) has maintained an outflow of… pic.twitter.com/nZcO8CbkTV
— Spot On Chain (@spotonchain) June 11, 2024
The presented content may include the personal opinion of the author and is subject to market condition. Do your market research before investing in cryptocurrencies. The author or the publication does not hold any responsibility for your personal financial loss.
