Bitcoin (BTC) price slipped to $29,000 on Wednesday as the summer slump in trading activity weighed on digital assets. The largest cryptocurrency by market capitalization sank to as low as $28,930, the weakest level since August 7 and down from $29,400 a day ago. The price had bounced modestly to just over $29,100 at press time.
Vetle Lunde, senior analyst at digital asset firm K33 Research said in a report, “Bitcoin still struggles to find any directional momentum as prices remain glued to $29K.”
Fundstrat Global Advisors’ Tom Lee, however, is bullish on bitcoin and sees the price reaching $150,000 if a bitcoin exchange-traded fund (ETF) is approved in the United States. Lee said in a note to clients that a bitcoin ETF approval would be a “game-changer” for the cryptocurrency market.
The SEC has yet to approve a bitcoin ETF, but several applications are pending. The approval of a bitcoin ETF would allow investors to buy and sell bitcoin on major exchanges, which could lead to increased demand and higher prices.
The overall cryptocurrency market capitalization fell to $1.2 trillion on Wednesday, down from $1.3 trillion a day ago. Ethereum (ETH) was the second-largest cryptocurrency, with a market capitalization of $150 billion. ETH price also fell to $1,700, the weakest level since July 20.
The decline in bitcoin and other cryptocurrencies comes as investors remain cautious about the global economic outlook. The Federal Reserve is expected to raise interest rates several times this year in an effort to combat inflation. Higher interest rates could weigh on risk assets like cryptocurrencies.
Despite the recent decline, bitcoin is still up about 50% year-to-date. The long-term outlook for bitcoin remains bullish, as more and more institutions are adopting the cryptocurrency.