Why Did BTC’s Price Tumbled $3K on Friday Despite the Impressive Bitcoin ETF Inflows?

After days and days of registering gains and testing the $72,000 price tag, bitcoin reversed its trajectory on Friday and slumped by more than three grand in hours.

The question arises as to why this happened since the inflows into the US-based ETFs keep coming.

The Bitcoin ETF Impact

It’s safe to say that the biggest and most vital news in the cryptocurrency industry this year has been the ETFs the US Securities and Exchange Commission greenlighted in January. Not the halving, which is typically all people can talk about every four years, but specifically the Bitcoin ETFs (the Ethereum ETFs’ impact will be known after they launch).

After all, numerous financial giants, including BlackRock and Fidelity, became issuers of an exchange-traded fund with an underlying asset a cryptocurrency – that’s a sentence that wouldn’t have made much sense five years ago. Now, though, retail investors, as well as institutions, can easily be exposed to bitcoin’s performance without having to worry about storing some mystic keys and remembering complicated passwords.

The effects were immediate as BTC’s price soared by more than 50% in weeks and tapped a new all-time high of $73,800 about two months after the ETFs launched in the States. This was the first time ever the asset had registered a new record before a halving.

The subsequent price movements were also heavily impacted by the inflows or outflows from these financial vehicles. For example, BTC slumped hard in mid-April and early May when investors were taking substantial amounts out almost on a daily basis. Price movements changed when their behavior changed in mid-May and so far in June.

In fact, the ETFs are on their best streak since they saw the light of day. The last time they felt outflows was a month ago – on May 10. This means that they have seen inflows for 19 straight days. Yet, BTC dumped hard on Friday, dropping from $72,000 to $68,500 in minutes.

Why Is That?

Well, if we can’t blame it on the ETF flows, the community has come to a consensus about the main reason. Popular analyst Willy Woo said, “bitcoin won’t get nice things until the last minute degen logs give up chasing the price,” suggesting that there’s too much leverage in the system. This theory was echoed multiple times on Crypto X in the past day or so.

Another theory that is quite popular among the community involves profit-taking. Coming just 2% away from its all-time high of $73,800 meant that almost all investors’ funds were in a profit, which many consider a good exit point to take some cash out.

No matter the reason, the fact of the matter is that BTC’s drop caused more than $400 million in liquidations within a day. This should be a warning to over-leveraged traders to be wary about such potential swings in either direction.

The post Why Did BTC’s Price Tumbled $3K on Friday Despite the Impressive Bitcoin ETF Inflows? appeared first on CryptoPotato.

How useful was this post?

Click on a star to rate it!

Average rating 0 / 5. Vote count: 0

No votes so far! Be the first to rate this post.

Latest posts

post-thumbnail
Chainlink’s CCIP Enables Seamless Onchain Payments for XPay by XSwap
XSwap has adopted Chianlink’s CCIP for its new XPay tool, ensuring secure and efficient onchain pa...
READ MORE
default post thumbnail
Legendary Trader Warns: Bitcoin Could Plunge Below $50,000 If These Key Levels Break
Renowned trader Peter Brandt recently provided insights on the Bitcoin price potential market moveme...
READ MORE
default post thumbnail
Dogecoin Sees Monumental Surge In Transactions As Whales Spend $129 Million
Dogecoin is currently at a critical price junction that might determine its price trajectory in the ...
READ MORE
default post thumbnail
MATIC Price Tests 8-Month Support As Polygon Unveils New Governance Hub
Polygon’s native token, MATIC, has experienced a notable disparity compared to the broader cryptoc...
READ MORE
default post thumbnail
Ethereum HODLers Scoop 298,000 ETH In 24 Ahead Of Spot ETF Trading
Ethereum is under pressure at press time, tumbling roughly 15% from March 2024. As sellers press on,...
READ MORE
default post thumbnail
Ethereum Withdrawals From Coinbase Top $1.2 Billion, What’s Going On?
Ethereum has seen a number of notable withdrawals that suggests that crypto whales are expecting a r...
READ MORE
default post thumbnail
Dogecoin Plunges 11%, But This On-Chain Cushion Could End Decline
Dogecoin has observed a plummet of 11% over the past week, but this decline may not continue further...
READ MORE
default post thumbnail
Polkadot (DOT) Token Utility
Polkadot is a protocol designed to connect different blockchains, enabling the transfer of value and...
READ MORE
default post thumbnail
Bitcoin-Focused Book Inspired Bill To Abolish Federal Reserve
US Congressman Thomas Massie has said that he was inspired by a Bitcoin-focused book, The Bitcoin St...
READ MORE
default post thumbnail
UwU Lend Offers $5M Bounty For Information On Attacker
The team behind the UwU Lend protocol has offered a $5 million bounty to whoever can identify its at...
READ MORE
Read more posts