Bitcoin Falls After Record Highs: 3 Major Crypto Events
On Tuesday, Bitcoin (BTC-USD) stumbled and fell below $63,000, after reaching a new all-time high of over $69,000. The drop came after a surge in Bitcoin’s price in recent weeks, which saw it rise by over 500% since the start of this year. According to Bitwise Asset Management CIO Matt Hogan, the biggest threat to Bitcoin is if long-term investors decide to sell their holdings. Hogan also notes that the ETF market is currently soaking up more than 100% of the net new supply.
In this article, we will discuss the three biggest events that have taken place in the crypto space and their impact on Bitcoin’s recent price movements.
The Three Biggest Crypto Events
1. ETF Applications and Approvals
The first major event is the increasing number of ETF applications and approvals. ETFs are exchange-traded funds that track the performance of an underlying asset, such as cryptocurrencies. The approval of more ETFs will provide mainstream investors with a simple and efficient way to invest in Bitcoin, which could lead to increased demand and higher prices.
2. The April Bitcoin Halving Anticipation
The second major event took place in April 2020, when the Bitcoin halving occurred. Bitcoin is limited to 21 million coins, and the halving reduces the number of new coins mined from 12.5 to 6.25. Halvings occur approximately every four years, and they create a supply shock that reduces the amount of new Bitcoin entering circulation. This creates an anticipation of a price increase because of supply and demand dynamics.
3. A Year of Global Elections
The third major event is the year of global elections, where more than 60 countries are heading to the ballot boxes. In these elections, cryptocurrencies, and Bitcoin, in particular, have become issues as some countries consider adopting digital currencies, and others look to regulate them. Regulators in Asia, such as Hong Kong and Singapore, have more progressive and open-minded views towards digital assets, which could help drive adoption there. In the Middle East, inflation concerns may lead to increased adoption, with more people seeing Bitcoin as a hedge against inflation.
What’s Next for Bitcoin?
As Bitcoin continues to experience price volatility, it is important to watch out for upcoming events that could impact its price. These events include the potential approval of more ETFs and the next Bitcoin halving, which could result in increased demand and higher prices. Meanwhile, global elections may contribute to increased adoption in some regions.
Holding $60,000 could be a key level to support Bitcoin, as it has broken out of the crypto winter and reached new all-time highs. Investors should also closely monitor long-term holders, as they have the power to impact Bitcoin’s price if they decide to sell their holdings.
In conclusion, while recent price drops have caused concern among Bitcoin investors, it is important to remember that the cryptocurrency space is still young and has a lot of room for growth and development. As such, investors should diversify their holdings and be prepared for volatility while also keeping an eye on potential growth opportunities.
Hot Take
Bitcoin’s recent fall from its record high serves as a reminder for investors to be prepared for the volatility that comes with cryptocurrency investments. While the cryptocurrency space is still young and has a lot of potential for growth, investors need to be cautious and consider diversifying their holdings. They should also keep an eye on upcoming events that could impact Bitcoin’s price, such as ETF approvals, the next halving, and global elections. Overall, Bitcoin may be down now, but it is still a valuable asset that has shown potential for growth in the long term.
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