In the geopolitical tension, the cryptocurrency market experienced significant fluctuations over the weekend and continued to decline on Monday.
Bitcoin briefly approached $67,000 in the early morning hours in the Eastern United States but lost momentum afterwards, hitting a low near $62,380. As of the time of writing, the trading price of Bitcoin was $62,976.73, with a 1.4% decrease in the past 24 hours.
Ethereum broke below the $3,100 mark, with a 1.42% decrease in the past 24 hours.
With the stagnation of BTC momentum, altcoins slid. The majority of the top 100 altcoins by market capitalization declined. In the past 24 hours, Core DAO (CORE) led the gains with a 59.64% increase, followed by Bitcoin BEP2 (BTCB) with a 28.84% increase, and OKB with a 12.37% increase. Starknet Token (STRK) had the largest decrease of 8.64%, followed by Bittensor (TAO) with an 8.09% decrease, and Ethena (ENA) with a 7.57% decrease.
The three major U.S. stock indexes also experienced general declines. At the close, the S&P, Dow, and Nasdaq indexes were down by 0.62%, 0.65%, and 1.79% respectively.
ETF flows turned negative, but the approval of spot ETF products in Hong Kong may bring a boost.
As investors became more hesitant, ETF funds entered negative territory. According to a weekly report on digital asset fund flows published by CoinShares on April 15, digital asset investment products experienced an outflow of $126 million. This is the first week of outflows since the record-breaking $1 billion outflow in the week of March 22.
In terms of regions, the outflow from the United States was the largest at $145 million, followed by Canada and Switzerland with outflows of $6 million and $5.7 million respectively.
In terms of assets, Bitcoin investment products had the largest outflow at $110 million, but they still maintained a net inflow of $555 million so far this month. James Butterfill, Research Director at CoinShares, stated, “Short Bitcoin products broke the streak of three consecutive weeks of outflows and saw a minor inflow of $1.7 million, likely due to investors taking advantage of recent price weakness.”
In comparison, Ethereum investment products suffered the most, with outflows of $29 million for the fifth consecutive week.
However, the approval of spot ETF products in Hong Kong may bring a boost to the market.
According to Caixin, Bosera International, Huaxia Fund (Hong Kong), and Harvest Global Investments, subsidiaries of public funds, disclosed on April 15, 2024, that the issuance of virtual asset spot ETF products had received preliminary approval from the Hong Kong Securities and Futures Commission. The approved offerings include not only Bitcoin but also Ethereum, which has not yet been approved by the U.S. SEC. Reliable sources revealed that these virtual asset spot ETF products are expected to be listed as early as the end of April, making them the first Bitcoin spot ETF and Ethereum spot ETF in Asia.
Eric Balchunas, an ETF analyst at Bloomberg, commented that it is expected that the Hong Kong spot Bitcoin ETF will not attract a large amount of flow (some analysts estimate $25 billion), and the estimated inflow of funds may be $500 million. The reasons are as follows: 1. The Hong Kong ETF market is small, with only $50 billion, and mainland Chinese people cannot purchase it, at least not through official channels. 2. The three approved spot Bitcoin ETF issuers (Bosera, Huaxia, and Harvest) are small in size and do not yet have large institutions like BlackRock participating. 3. The liquidity/efficiency of the underlying ecosystem is low, which may result in large spreads and premium discounts for these ETFs. 4. The transaction costs may be 1%-2%, which is higher compared to spot Bitcoin ETFs in the United States.
However, Eric Balchunas emphasized, “All of this is obviously positive for Bitcoin as it opens up more investment avenues. I’m just saying it’s ‘kid stuff’ compared to the U.S. Some of these issues may disappear in the long run with more liquidity, smaller spreads, lower fees, and more issuers participating, but our expectations in the short to medium term are more moderate.”
The adjustment will continue.
CryptoQuant analysts believe that there is a strong possibility of further adjustment in Bitcoin prices. This is supported by various factors, including a higher average 30-day funding rate, resistance at the current historical high, and the market setting that allows “large participants to build large positions.”
Gaa, a CryptoQuant analyst, stated in the report, “Historically, when retail investors engage in massive profit-taking, it indicates a potential top is forming. After the rapid price decline in the past two days, these holders are selling off their large positions.”
QCP Capital, a Singapore-based digital asset trading firm, stated in a report to investors that historically, buying on dips during major geopolitical conflicts has been a profitable trade.
Ed Goh, Head of Trading at liquidity provider B2C2, stated that the company has seen continued buying pressure on BTC, especially during the weekend dip, with 57% of the platform’s funds flowing to buyers. Analysts added that altcoin activity remains high, with investors inclined to purchase altcoins.
The current total market capitalization of cryptocurrencies is $2.32 trillion, with Bitcoin’s dominance rate at 53.66%.
Author: BitpushNews Mary Liu
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Tags:
$BTCB
2023 market trends
Core DAO
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ETF
Ethereum
Halving
Altcoins
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Grayscale
Spot Bitcoin ETF
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BlackRock
Hong Kong
Note: All articles from Bitpush represent the author’s views and do not constitute investment advice.
Original article link:
https://www.bitpush.news/articles/6611837
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