Bitcoin falls 8% in five days; here are 4 reasons behind the plunge

Stocks Watch April 18, 2024 News Team

Bitcoin continues to fall on Wednesday, April 17, by declining over 3.84 per cent to $61,309. The world’s largest cryptocurrency has fallen over 8.81 per cent in past five days and over 10.31 per cent in the last one month.

The Commerce Department’s Census Bureau reported a 0.7% increase in retail sales last month. Additionally, data for February was revised upward, indicating a stronger rebound of 0.9%, marking the largest gain in over a year, as opposed to the initially reported 0.6%.

Over the past 24 hours, the global cryptocurrency market experienced a 4.1% decrease, reaching approximately $2.29 trillion in market capitalization.

Presently, the total volume within the DeFi sector stands at $9.35 billion, accounting for 7.92% of the entire cryptocurrency market’s 24-hour trading volume. Meanwhile, the collective volume of stablecoins amounts to $110.24 billion, constituting 93.37% of the total 24-hour trading volume in the cryptocurrency market, as reported by CoinMarketCap.

Within the same timeframe, Bitcoin’s market capitalization dropped to $1.239 trillion. Bitcoin’s dominance is currently at 54.11%, as indicated by CoinMarketCap. Moreover, Bitcoin’s trading volume in the past 24 hours increased by 6.23% to reach $44.77 billion.

“After Iran Israel tensions escalated on the weekend, BTC now seems to slowly trade around the halving news as its main fundamental. A strong support seems to be formed at $60k as BTC continues to outperform the majority of the altcoins. To put things into context, one of the most traded crypto-crypto non-stable pair – ETH/BTC has broken down its support at 0.05 BTC per ETH. This could technically go as lower as 0.04 meaning BTC could further continue to outperform Ethereum, and historically, all altcoins,” said CoinSwitch Markets Desk.

What’s weighing on bitcoin prices?

  • Investors in the cryptocurrency market are eagerly anticipating the upcoming Bitcoin halving event, slated to cut the token’s new supply in half and anticipated to occur around April 20. Traditionally, this halving has boosted prices, but with Bitcoin recently reaching a historic high, doubts have emerged about the likelihood of a similar outcome this time.
  • Other key driving factor behind the decline is the cryptocurrency is influenced by stronger-than-anticipated US retail sales figures for March, which bolstered the belief that the US Federal Reserve is unlikely to hastily reduce interest rates this year.
  • A few days ago, Hong Kong granted conditional approval for its first spot bitcoin and ether exchange-traded funds (ETFs), marking a significant step towards the city potentially becoming Asia’s pioneer in embracing cryptocurrencies as a mainstream investment vehicle. Despite the ban on cryptocurrency in mainland China, Hong Kong has been actively positioning itself as a global digital asset hub, aiming to enhance its appeal as a financial center.
  • Iran retaliated against Israel by launching attack drones and missiles, seemingly in response to a strike in Syria that resulted in the deaths of senior Iranian military personnel, marking a dangerous escalation in the regional conflict. Over the weekends, digital assets are traded, providing investors with insight into potential market sentiment before traditional markets resume on Monday — yet, significant shifts may occur before trading recommences.

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