Why did the price of Bitcoin collapse?

Bitcoin continues to fall as it approaches halving. There are several reasons for the negative dynamics of cryptocurrency, including pressure from American regulators.

We tell you why Bitcoin fell and what cryptocurrency forecasts are given by members of the crypto community.

Why did Bitcoin fall?

Bitcoin started April with a 9% drop. As of the time of writing, the coin is trading at $66,455, which is 10% lower than the absolute maximum value recorded on March 14, 2024 at $73,750.

There could be several reasons for Bitcoin's fall. Let's look at them:

  1. Increasing attractiveness of other instruments. Bitcoin fell amid rising yields on 10-year US Treasury bonds and a strengthening dollar. The changes could become a reason for investors to transfer part of their assets from high-risk cryptocurrency to classical instruments.
  2. Declining optimism about Fed monetary easing. BTC fell amid cooling of forecasts for the Fed’s key interest rate. A month ago, 26% of market participants believed in a rate cut. By April 1, amid stronger-than-expected US manufacturing data, the number of optimists fell to 1.8%. A rate reduction could increase the investment attractiveness of high-risk assets.
  3. Unfavorable conditions in the ETF market. Bitcoin's position weakens the outflow of assets from spot BTC ETFs. The changes force issuers of the instrument to sell cryptocurrency, thereby putting pressure on its rate.
  4. Movement of Bitcoins by the US Government. The risks of selling a large volume of cryptocurrency may negatively affect its rate.

Bitcoin forecast from members of the crypto community

On April 20, the most anticipated event in the crypto industry will take place – the Bitcoin halving. Observations indicate that with it a new growth cycle could come, which could take BTC to a cyclical high.

Most experts predict high Bitcoin volatility this month. At the same time, our interlocutors warned market participants about a possible sale of BTC after halving. For many investors, the event will be a sell the news – news that can be considered as a signal to sell cryptocurrency. The fact is that some market participants assume that against the background of halving, Bitcoin will reach a local maximum. Those who hold this view may begin to take profits after the event. In this case, the BTC rate will be under pressure.

Many representatives of the crypto industry considerthat the fall of Bitcoin in early April is the last chance to buy cryptocurrency before its expected entry into active growth after halving. However, few are expecting a resumption of positive movement ahead of the event.

Analyst Michael van de Poppe believesthat there is a sideways movement ahead for BTC. By canceling the script in his opinion, a breakthrough of the $69 thousand level can be considered. In this case, the analyst suggested, BTC will have a chance to update the absolute maximum before the halving. At the same time, Poppe does not exclude the possibility of a negative scenario, which we will talk about a little later.

Similar Bitcoin forecast gave Trader Inmortal. He suggested that BTC could continue to move in the body of the triangle, the boundaries of which he outlined on the chart.

Head of the analytical platform CryptoQuant Ki Young Joo supported another bitcoin forecast. In his opinion, BTC is in the middle of a bullish cycle. The analyst believes that after the completion of the correction of about $60 thousand in mid-April, the cryptocurrency will rise with the prospect of updating the absolute maximum value.

Some members of the crypto community see potential for a deeper correction in BTC. For example, trader @ToniGhinea does not exclude Bitcoin at $50 thousand in April. Michael van de Poppe in turn sees prospects for BTC falling only to $56 thousand. At the same time he believes into the potential of long-term Bitcoin investments. Poppe's optimism divided trader Peter Brandt, popular in the crypto community.


Source: Cryptocurrency

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