- The decline in ETF purchases this week influenced the depreciation of the cryptocurrency.
- The 5% drop in the price of Bitcoin early Wednesday was due to the withdrawal of earnings by long holders.
- The performance of Bitcoin this year places it in the number eight position of the most traded assets in the world.
Bitcoin saw a sharp drop on Wednesday at 3:00 AM EST to $58,851.20, according to Coin Metrics. Meanwhile Ether, the second in capitalization, also lost almost 4% and was trading at $4,008.38, CNBC reported.
However, Bitcoin has already reached a prominent place among the world’s top ten largest assets. So this downward movement has not sparked anguish for investors who remain confident in the rise of BTC.
The market was expecting a pullback for the cryptocurrency after the sharp rise in recent weeks due to the launch of the ProShares Bitcoin Futures ETF, the first Bitcoin futures ETF, on Tuesday, October 19.
Similarly, the market reacted positively when the Chicago Mercantile Exchange listed Bitcoin futures in 2017 and then in April when Coinbase (NASDAQ:COIN) went public. Analysts are eager to see what the cryptocurrency will do next.
Due to its high volatility, after a sharp rise in the cryptocurrency, there has historically been a deep fall. It is not known if the price of BTC will fall again or how long it will take to recover.
The current drop in the crypto asset coincides with the growth of the Shiba Inu memecoin this week. In the last 24 hours, it has reached an all-time high, climbing 28%, according to CoinGecko data.
Bitcoin Competes with Silver
Bitcoin is ranked the eighth largest asset in the world, leading gold. The top cryptocurrency in market capitalization has achieved a market capitalization of $1,113,647,208,637 this week, according to CoinMarketCap.
Now it competes with silver, which occupies the seventh position on the list of largest assets, and already, many warn that its ascending career could place this asset on par with gold, so much so that it is called “digital gold” because it has a limited number of tokens.
BTC inflows this year amount to about $8 billion, far exceeding the record reached last year when it topped $6.7 billion, according to data from CoinShares.
Of the total new inflows of funds entered last week, the cryptocurrency received 99%. Of the new inflows, $1.24 billion were in the United States. Likewise, in other regions, Bitcoin products registered entries for a total of $138 million.
Outflows were also recorded because investors took profits from some products (especially older ones), when Bitcoin reached highs last week of $66,000.
On The Flipside
- When it hit these price levels, total Bitcoin assets under management hit a new record by exceeding $79,000 million.
Why You Should Care?
- Some analysts believe that it is time to buy, while others believe that it is better to wait for the market to correct itself. The most skeptical analysts believe this to be a digital bubble without its own value.
- The truth is that the value of Bitcoin, like that of the rest of the cryptocurrencies, is increasing every day.
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