Hello friends, the fat is back and bitcoin falls almost 10% after the long-awaited launch of the bitcoin spot etf in the United States and has left a sea of doubts among investors. We close one of the most volatile weeks in recent months full of ups and downs that have changed investor sentiment from extreme euphoria to fear and uncertainty after what happened this week.
In recent days they have been quite busy for bitcoin since after the approval of the ETF we have seen a lot of volatility in the market that began with the rise last Thursday with the opening of the American market after the start of trading of the bitcoin etf, an event that It generated a lot of expectation and managed to break historical records for ETF launches.
The bitcoin ETF managed to move a volume of more than 4,000 million dollars on the first day of which more than 720 million were in inflows to bitcoin and registering a total of more than 700,000 individual transactions, figures that revolutionized Wall Street with headline announcements in the media and the attention of thousands of investors.
What was directly reflected in the price, causing it to rise very strongly in a few hours, breaking the highs from more than 24 months ago, is that if we open the bitcoin chart from the early hours of the morning of Thursday the 11th, the price is already It began to rise noticeably, going from 45,600 in just under 9 hours to rising more than 7% to almost $9,000, a price that we had not seen since December 31, 2021.
However, all the euphoria disappeared suddenly after the market opened, which caused a fairly strong correction, taking bitcoin to $45,000 in less than 2 hours, a drop of almost 7%, which after stabilizing slightly around $46,000 throughout The weekend would continue to correct, which caused bitcoin to plummet even further until it touched $41,500, falling another 10% in just 10 hours to accumulate a total of a 12% drop.
All of this made many investors begin to fear the worst about the impact of ETFs and seeing the real possibility that this drop could continue causing bitcoin to fall back below 40,000 an event that once again had an impact. devastating in the futures causing the liquidation of hundreds of millions of dollars in just a few hours.
The root of this latest fall in bitcoin is that, as I wrote in a publication a couple of weeks ago, whenever we have had announcements at an institutional level, bitcoin has marked a maximum with new increases followed by sharp falls in price, as happened in In 2017, CME Group Inc, the largest futures exchange in the world, launched bitcoin futures in December, an event that created a lot of expectations, causing the price of Bitcoin rose to its maximum at that time of $19,900 and more than 1114%, which is from the minimum of that cycle.
Bitcoin entered a period of significant decline that led it to correct more than 80%, just like what happened in the previous cycle when in 2021 with the launch of the Coinbase IPO, another key institutional event that was the maximum at that time of the bitcoin cycle touching almost $65,000 and rising more than $17,000 from the cycle low, an event that was also accompanied by a sharp drop of more than 55% that led the price of bitcoin to fall below $30,000.
Now with the launch of the ETF, an event that, although it has not marked maximums in this cycle after its launch, has caused a fairly important correction in the price of bitcoin, falling almost $8,000 in a matter of hours. Despite the good news, there are several factors that have led to the price to fall recently but I will only say one.
The fomo is that it is evident that the launch of the ETF has generated a lot of expectation recently and in recent months the price of bitcoin has risen quite a bit, to be exact more than 200% from the minimum of this cycle, which has caused the euphoria to rise. something that normally tends to relax after the release of the news returns among investors, potentially dragging the price slightly downwards.
Since there is no important news and since the expectation of the ETF disappeared with its approval, many investors do not see the logic of continuing to hold their bitcoin and withdraw it to operate with other cryptocurrencies. So I think that the market will remain calm for the rest of the month and for the following month the expectation of the next halving begins that could once again create the fomo and euphoria that we experienced at the beginning of this year.
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https://twitter.com/joel_jai1/status/1746930090598887612
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