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Bitcoin Drops Beneath $41K, ETH, SHIB and Other Altcoins Follow; Here Are 3 Reasons

Mon, 04/11/2022 - 13:08
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Tomiwabold Olajide
Most of the other top altcoins are performing even worse than Bitcoin
Bitcoin Drops Beneath $41K, ETH, SHIB and Other Altcoins Follow; Here Are 3 Reasons
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Bitcoin fell further to lows of $40,930 on April 11, marking the second day of declines from highs of $43,450. BTC is down 11.13% over the past week after repeatedly failing to gain footing above the $47,000 level in early April. Terra's $176 million Bitcoin purchase that took place on Sunday failed to prop up the price of the flagship cryptocurrency.
Most of the other top altcoins are performing even worse than Bitcoin over the past seven days, with Ethereum (ETH) and Shiba Inu (SHIB) shedding 6.07% and 5.71%, respectively, in the last 24 hours, per CoinMarketCap data. The majority of altcoins were also losing value at press time.

BTC/USD Daily Chart, Source: TradingView

As previously covered by U.Today, Luna Foundation Guard (LFG), a Singapore-based non-profit organization focused on boosting the Terra blockchain, snapped up another $176 million worth of Bitcoin. LFG now holds roughly $1.7 billion in the largest cryptocurrency.

Bitcoin trades at $41,224 while ETH was seen at $3,059 at press time.

Three potential reasons for the declines:

Investor fears

The Crypto Fear and Greed Index that gauges market sentiment measured ''fear'' at press time, depicting the pervading fearful sentiment among investors. Presently, the index measures just 32/100, portraying fear. This reflects a shift from last week's ''neutral'' levels.

DXY strength

The dollar index (DXY), which gauges the greenback's value versus different currencies, hit two-year highs above 100 earlier today. This month, the global reserve currency has gained 1.64%, according to data provided by TradingView. A strengthening DXY might impact cryptocurrency prices, as Bitcoin and altcoins are paired against USD.

Fed's tightening concerns

On Monday morning, the 10-year Treasury yield surpassed 2.76%, while the 5-year and 30-year rates remain inverted. Concerns that increasing inflation and the Federal Reserve's plans to tighten monetary policy aggressively could hinder economic development have pushed Treasury rates higher recently.

This week will see the release of two sets of inflation data: the March consumer price index on Tuesday and the producer price index from the previous month on Wednesday. There are no major economic data releases due out on Monday.

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About the author

Tomiwabold is a cryptocurrency analyst and an experienced technical analyst. He pays close attention to cryptocurrency research, conducting comprehensive price analysis and exchanging predictions of estimated market trends. Tomiwabold earned his degree at the University of Lagos.