The crypto market is cooling off. Bitcoin and other major cryptocurrencies are dipping, testing the resolve of investors who’ve seen big price swings recently. After a period of wild price changes and rapid growth, things are getting calmer, but also more uncertain.
A Slower Climb
According to CryptoQuant analyst Dan, the long-term picture is interesting. He looks at how much Bitcoin has been held for over a year. In previous market cycles, this number grew quickly during periods of buying, leading to big price increases. But this time, the growth is slower. The upward trend is flattening out, suggesting this cycle is taking longer than previous ones.
What’s Behind the Slowdown?
Several things are likely contributing to this slower pace:
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Spot ETFs and Institutional Money: The arrival of spot Bitcoin ETFs (exchange-traded funds) has changed how money flows into the market. Big institutional investors and even some countries are now involved, making the market more stable but also less prone to rapid price swings.
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Altcoin Influence: Whenever a lot of money moves into other cryptocurrencies (altcoins), Bitcoin’s price tends to stall. This has happened several times, showing that investors spreading their money around slows Bitcoin’s growth. Unlike previous periods where Bitcoin dominated, we’re now seeing a gradual shift of money into altcoins.
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The Bigger Picture: Economic factors also play a role. Potential interest rate cuts and the possibility of approving spot ETFs for other cryptocurrencies could boost the market later this year and into 2025.
Bitcoin’s Battle at $110,000
Bitcoin’s price is hovering around $110,000 after a recent drop from its high of around $123,200. The price charts show a clear shift in momentum, with lower highs and lower lows indicating continued selling pressure.
Bitcoin is currently just above its 100-day moving average, but below its 50-day moving average, which is acting as resistance. Breaking below $110,000 could lead to further losses, while reclaiming $115,000 would be a significant sign of recovery. For now, the market is uncertain, and whether Bitcoin can hold above $110,000 will determine the short-term outlook.