Bitcoin Tumbles 10% Following Launch of Spot ETFs in the US
San Francisco, Jan 14: Bitcoin Sees Sharp Decline to $42,000 as US Bitcoin ETFs Debut. In a swift downturn, the price of Bitcoin plummeted nearly 10% to approximately $42,000 following the initiation of trading for spot Bitcoin exchange-traded funds (ETFs) in the United States.
Last week, Bitcoin achieved a high of $46,000 and surged to a two-year peak of $49,000 coinciding with the commencement of bitcoin ETF trading in the US. However, the optimism surrounding this milestone was met with a downturn, impacting the cryptocurrency market.
Shares of popular crypto exchange Coinbase experienced a notable dip of 7.4% in the aftermath of the bitcoin ETF news, as reported by Coindesk.
Bitcoin, which had undergone an impressive 80% rally since early October, faced challenges in breaking the $50,000 mark. The excitement surrounding the ETFs appears to have cooled down, prompting questions about the sustainability of upward momentum in the market.
Crypto research firm Swissblock stated, “The recent dynamics in bitcoin have not lived up to the expectations set by many bitcoin maximalists, with the asset failing to break the $50k mark, and the hype surrounding ETFs showing signs of cooling down.”
Another research firm, CryptoQuant, had previously predicted a potential decline in Bitcoin’s value to as low as $32,000 following an ETF approval.
Last week, the US Securities and Exchange Commission (SEC) granted approval for several spot Bitcoin ETFs. This approval is not only seen as a sign of a maturing market but also indicates regulatory support for the world’s largest cryptocurrency entering the global financial system.
Analysts suggest that spot Bitcoin ETFs have the potential to evolve into a $100 billion product. The market now observes how Bitcoin will navigate these recent developments and whether it can regain momentum in the near future.
