Bitcoin Plunges, Erasing All Year's Gains
Bitcoin is again under severe pressure just a month after its record high. The price of BTC fell below $93,714, erasing more than 30% of the gains accumulated since the beginning of the year. This bearish trend emerged after market euphoria over the Trump administration's pro-crypto policies faded and Trump's comments on tariffs rattled global markets since early October.
After briefly hitting a record high of $126,251 on October 6, Bitcoin began to plunge just four days later. As of Monday morning in Singapore, the price had recovered slightly to $94,869, but remained below its closing level at the end of last year. Analysts say the global market is in risk-off mode, making riskier assets like crypto the first to feel the pressure.
Over the course of the year, institutional interest and ETF inflows have been the main drivers of Bitcoin's rally. Crypto ETFs have even recorded inflows of over $25 billion, pushing assets under management to near $169 billion and strengthening Bitcoin's image as a portfolio diversifier. However, in the past month, institutions, ETF allocators, and large corporations have begun to withdraw, depriving the market of its previously strong capital inflows.
Analysts believe this weakening is a combination of long-term investor profit-taking, institutional fund outflows, macroeconomic uncertainty, and the liquidation of leveraged positions. With the bullish narrative beginning to crack and market participants opting to hold back, Bitcoin has returned to a downward phase after a long period of flat movement. (asd)
Source: Bloomberg.com
