Bullish Fundamentals
Bitcoin’s supply on exchanges has hit a four-year low, indicating that investors are holding onto their coins rather than selling. Demand for Bitcoin is also outpacing supply, which typically boosts its value.
Price Crash Causes
Despite these bullish signals, Bitcoin’s price has been declining. Crypto analyst Alex Kruger attributes this to:
- Overleveraged Traders: Traders in the derivatives market may be taking on too much risk in anticipation of further price increases.
- ETH Market Drag: Ethereum’s (ETH) potential approval of Spot ETFs has waned, which could be dragging down the entire crypto market.
- Negative Bitcoin ETF Inflows: Interest in Bitcoin ETFs has cooled, with investors choosing to take profits instead.
- Pre-Halving Retrace: Bitcoin may be experiencing a correction before the upcoming halving event in April, where miners’ rewards will be cut in half.
Current Price
At the time of writing, Bitcoin is trading around $63,000, down from the previous 24 hours.
