Bitcoin has experienced a significant drop earlier today, plummeting to an intraday low of $39,494.65.
This latest decline has brought its market capitalization down to $784.8 billion with a 24-hour trading volume reaching $30 billion.
As of the latest update, Bitcoin has slightly recovered, trading around $40,032.31, but the 24-hour range indicates a tumultuous period for the cryptocurrency, having oscillated between $39,494.65 and $41,269.88.
Understanding the selloff
The downward trend in Bitcoin's value can be largely attributed to significant outflows from Bitcoin exchange-traded funds (ETFs).
Notably, the Grayscale Bitcoin Trust (GBTC) witnessed a staggering $640 million exit in just one day, marking the largest outflow it has ever experienced. The total amount withdrawn so far has reached a concerning $3.45 billion.
James Seyffart, the leading ETF analyst, pointed to this trend in his social media post, underscoring the increasing pace of these outflows.
Additionally, analyst Holger Zschaepitz stressed diminishing enthusiasm for Bitcoin ETFs, which coincides with a drop in the correlation between Bitcoin and technology stocks, currently standing at a low of 0.3 in the past week.
Bearish sentiment from market analysts
The recent bearish sentiment surrounding Bitcoin has fueled doom-laden posts from prominent naysayers.
Peter Schiff, a well-known critic of Bitcoin, took to X to express his bearishness, particularly focusing on the ProShares Bitcoin Strategy ETF. This ETF, which tracks Bitcoin futures, has seen a decline of over 50% in just over two years since its launch in October 2021. Schiff sees other ETFs witnessing the same fate.
Jim Cramer, another influential voice in the financial world, succinctly summed up the situation with a post stating, "Bitcoin=tough own," after previously predicting that the flagship cryptocurrency would struggle to find a footing.
Mushumir Butt
Gamza Khanzadaev
Tomiwabold Olajide
