March 27, 2024
Bitcoin Dips to $38.5K Amidst ETF Launch and Investor Activity
Bitcoin price today

Bitcoin Dips to $38.5K Amidst ETF Launch and Investor Activity

On Thursday, January 25, 2024, Bitcoin’s price is $39,912.30. Bitcoin faced a notable downturn, touching $38.5K, linked to the debut of the United States’ inaugural spot Bitcoin exchange-traded funds (ETFs). Despite significant inflows after their January 11 launch, these ETFs coincided with a 20% decline in BTC/USD.

The Grayscale Bitcoin Trust (GBTC) conversion to an ETF is seen as a contributing factor, allowing long-term investors to exit and adding to selling pressure. While large quantities of BTC moved from Grayscale to Coinbase, critics argue this might not be the primary driver of Bitcoin’s descent, pointing to FTX exchange sales and derivatives liquidations.

On-chain metrics, particularly the Advanced Network Value to Transaction (NVT) Signal, suggest the recent BTC price is meager, introducing complexity to market dynamics. Coin movements by long-term holders during this decline raise concerns about a potential deepening of the bearish trend.

As market participants assess the impact of the ETF introduction and various contributing factors, the future trajectory of Bitcoin’s price remains uncertain, with potential implications for both short-term and long-term market participants.

Image by Pete Linforth from Pixabay

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