Bitcoin Price Drops Below $40,000 as Bears Take Control
The price of bitcoin fell below the key psychological level of $40,000, reaching a 7-week low of $39,440 on Saturday. This marks a nearly 20% decline from its 2024 high of $48,500 in January.
GBTC Sells $640 Million in Bitcoin
Grayscale Bitcoin Trust (GBTC) sold $640 million worth of bitcoin on January 22nd, surpassing inflows into other spot BTC ETFs like BlackRockβs iShares Bitcoin Trust (IBIT).
Analysts Predict Further Downside for Bitcoin
Analysts believe that the correction in bitcoin could deepen to around $34,000, representing a potential 30% decline, if bulls fail to generate momentum.
GBTC Selling Expected to Ease
The selling pressure from GBTC is expected to ease as the initial frenzy surrounding the launch of spot ETFs subsides. This could lead to a short squeeze and a rally driven by FOMO (fear of missing out).
Mt. Gox Could Impact Market with Bitcoin Repayments
Mt. Gox, the long-dormant exchange, may soon repay some creditors with over 200,000 bitcoin. This influx of previously locked-up coins could negatively affect bitcoin prices and sentiment leading up to the 2024 halving event.
Hot Take: What Lies Ahead for Bitcoin?
The recent drop in bitcoin price below $40,000 has raised concerns among traders. While GBTC selling has contributed to the downward pressure, analysts believe there may be further downside potential if bulls fail to regain momentum. However, there is hope on the horizon. As GBTC selling eases and spot ETFs gain traction, a short squeeze fueled by FOMO from new institutional buyers and retail traders could lead to a rally. Additionally, the repayment of creditors by Mt. Gox could impact the market. Overall, the future of bitcoin remains uncertain, with both risks and opportunities lying ahead.
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