The cryptocurrency market is known for its volatility. More than that, it is known for real estate turmoil; most of it makes it to the surface and then into reports. Volatility implies fluctuations in price and turbulence belongs to incidents that attract a lot of attention.
That said, BTC and ETH are working to find a way to return to their recent ATHs. BTC is up slightly by 1.76% and ETH is down by 0.80% in the last 24 hours at the time of writing. They are now trading at $66,821.59 and $3,277.99, respectively.
The turbulence has been caused by incidents such as the 25 years in prison for Sam Bankman-FriedBitcoin ETF outflows and expectations of rate cuts, to name a few.
For starters, Sam Bankman-Fried will almost certainly face 25 years in prison for embezzling approximately $8 billion in user funds. He has been convicted of committing fraud and devising ways to use funds in a way they should not have: real estate purchases, political donations, etc.
The initial reports that emerged caused the fall and collapse of FTX, which was once a dominant platform in the market. That had a domino effect on the rest of the chips.
Next, the year 2024 began with the expectation that there would be rate cuts (six to be precise). However, that figure has been revised and the best that could happen is three-quarters of a percentage by the end of the year. May can pass without any cuts. The last time a decision on a cut will be made is at the June meeting.
The S&P fell 0.72% on Tuesday and the Nasdaq shed a larger portion of 0.94% on the same day. A change in rate cut expectations has had a tangible effect on the price of BTC. The expansion of the US manufacturing sector in March and the acceleration of the personal consumer spending price index in February suggest that the economy is recovering. What poses a contradiction is the fear that inflation will rise again.
ETF Outflows They have leveled off previously, but ARK 21Shares, which will release the same, has raised questions about whether there will come a time when the market will relax. An outflow of $0.3 million was recorded on Tuesday, followed by an outflow of $87.5 million the next day. This has surpassed GBTC for the first time since the Bitcoin ETF hit the market.
Finally, altcoins and meme coins were attracting a lot of attention. That has softened with altcoins recording a pullback and meme coins experiencing price corrections. In other words, they are trading at a lower price despite the change in investor sentiment. AI tokens had created enormous momentum in his favor. That has also declined, with companies like FET, RNDR, and WLD falling 13.9%, 13.3%, and 18.7%, respectively, in the last 7 days.
AI tokens represent a convergence of Artificial Intelligence and blockchain technology. They are currently declining, but could soon change the trend.
Meme coins are down except WIF or dogwifhat. Its market capitalization was last seen above the $4 billion milestone, and the token traded with a 20% rally in the last seven days. Weekly sentiment has fallen and in the previous 24 hours, WIF has lost 10.72% of its value, which is now trading at $3.32 at the time of writing.
These events have collectively affected the price of the cryptocurrency, to the point that they have lost their recent ATH, and are now awaiting the next big event for an increase: the Bitcoin halving.
