- Bitcoin fell more than 16% in April, entering its worst month since November 2022.
- Ledn CIO said BTC could fall to the mid-to-low $50,000 region.
- ETF analysts at Bloomberg Intelligence noted that the debut of the Hong Kong Spot Cryptocurrency ETF was not as bad as expected.
Bitcoin (BTC) dipped below $60,000 after a weak Hong Kong spot ETF debut, calling the cryptocurrency correction a bear market on Tuesday as interest rate concerns gave traders enough reason to sell. Maybe the time has come.
Bitcoin hit an afternoon low of $59,100, its lowest since late February and has fallen more than 5% in the past 24 hours. wide market CoinDesk 20 Index During the same period (CD20) further declined, dropping by 6% as Ethereum (ETH), Solana (SOL) suffered losses of 7%-8%.
Bitcoin is currently down about 20% from its all-time high of over $73,000 in mid-March.
Traditional markets similarly struggled after a series of U.S. economic reports on Tuesday morning showed slowing growth and accelerating price pressures, giving a hint of stagflation. On the day, the NASDAQ fell 2%, and the S&P 500 fell 1.6%.
Joel Krueger, market strategist at LMAX Group, said in a Tuesday report that strong U.S. economic data and recent reports of overheating inflation have sharply curtailed expectations for U.S. Federal Reserve interest rate cuts, leading to a rise in digital assets. He pointed out that this was weighing on the market.
“Despite investor calls for further easing, we continue to see evidence that the Fed needs to lean high on its long-term policy outlook,” Krueger said. “We are seeing this trickle down to crypto assets as well, as the U.S. dollar is returning to popularity across the board.”
Worst month since FTX
Tuesday's decline puts BTC and the broader crypto market on track to end its seven-month winning streak with the worst monthly decline since November 2022, when crypto exchange FTX collapsed.
With just hours left until the end of the month (UTC time), Bitcoin is down over 16% over April, while Ethereum is down 18%. Smaller cryptocurrencies have suffered even more severe corrections, with altcoin darlings SOL, Dogecoin ( DOGE) and Avalanche (AVAX) down 35%-40% this month.
Overall, the cryptocurrency market capitalization lost nearly 18% of its value, marking the biggest decline since June 2022. TradingView data is shown.
Bitcoin's fall may not be over yet
“We expect it to fall into the mid-to-low $50,000 region.” [for BTC]This should be a buying opportunity,” said John Glover, chief investment officer at crypto lender Redon.
K33 Research noted that the seasonal effect of lower interest rates over the summer also suggests lower prices.
“Traders are choosing a strategy that buys BTC on the opening day of May trading and closes May trading.
“Cumulative returns on the September close would have been -29% over the past five years, whereas traders who bought at the October close and sold during the April close would have returned 1,449%,” said K33 analyst Vetr Runde. “We would have experienced huge returns.” ”
(Not) Lukewarm Hong Kong ETF debut
The Hong Kong-listed Spot Bitcoin and Ether ETF's opening day failed to surprise market participants, who focused on the lukewarm product with just over $10 million in trading volume.
However, Eric Balchunas, senior ETF analyst at Bloomberg Intelligence, noted that the debut was more successful than first impressions, given that the Hong Kong ETF market is only a fraction of the size of the U.S. market. .
“Once we localized the numbers, this was a big problem,” Balciunas said.
ChinaAMC's Bitcoin product alone attracted more than $123 million in assets in its first trading session, making it the sixth-best ETF launched in the past three years and already among the top 20% of ETFs by size. He said that it is in. quoted Bloomberg data.
Balchunas also added that Hong Kong-listed ETFs come at a “good time” and could help offset outflows from U.S. products, which have slowed recently.
