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Bitcoin

Bitcoin’s daily chart has painted a stark picture with a massive red candle signaling a sharp 6% drop this Friday. The biggest cryptocurrency has plunged nearly 10% over the week, closing at $61,592 after an intraday recovery. 
Despite briefly reclaiming the $61,000 mark from a low of $60,433, the bearish tide has caused a ripple effect throughout the crypto market. Altcoins, including Ethereum, have also felt the impact, with Ethereum slipping under $3,000 and meme coins crashing. The market is reeling from a wave of <a href="https://www.coinglass.com/LiquidationData" target="_blank" rel="noreferrer noopener nofollow">liquidations</a>, with nearly $500 million in long positions wiped out in just 48 hours. 
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 <img decoding="async" src="https://lh7-rt.googleusercontent.com/docsz/AD_4nXe4UYyK-T90svEv5jrkP6YSLf55R_wQ4KkfqSsxP41NvDB0weFeoZ77nNKyGUSBFBY3mEr-2YAOETmBzQZ45jknm0yD_vGKBwWHsu-RNhkLcKlLDb0FRs7aFf4yADlDbaQmqBpvqZls0KkyYAhS5cp9JkNj?key=p2lf-Ce-TdZNi1xueqYasA" alt="Coingecko" style="width: 100%;height:auto">
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 Source: <a href="https://www.coingecko.com/en/coins/bitcoin" target="_blank" rel="noreferrer noopener">Coingecko</a>
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So what’s behind this sudden downturn? 
<ol> 
 <li>FOMC Meeting Delay Hits Hard</li> 
</ol> 
The Federal Open Market Committee (FOMC) meeting was a major event for the crypto market, initially fueling optimism due to a promising rally before the meeting and positive July Consumer Price Index (CPI) data. 
There was excitement about potential Bitcoin purchases by major U.S. pension funds through ETFs. However, the long-awaited rate cut was postponed, with no new decisions expected until September.&nbsp; 
<ol start="2"> 
 <li>Huge Bitcoin ETF Outflows</li> 
</ol> 
On August 2, Bitcoin ETFs saw a dramatic shift with net daily outflows reaching $237.45 million. Fidelity’s FBTC fund led the pack with a $104.1 million outflow, followed by Ark’s ARKB and Grayscale’s GBTC with outflows of $87.68 million and $45.95 million, respectively. The only exception was <a href="https://www.cryptotimes.io/2024/08/02/blackrock-continues-to-buy-bitcoin-amid-price-drop/" target="_blank" rel="noreferrer noopener">BlackRock’s IBIT fund, which saw a positive inflow</a> of $42.8 million.&nbsp; 
<ol start="3"> 
 <li>Mt. Gox Bitcoin Distribution</li> 
</ol> 
The ongoing distribution of Bitcoins by Mt. Gox to creditors has fueled the fire. Of the $9 billion due, $3 billion has already been sent to exchanges. This distribution has increased selling pressure, contributing to the market’s downturn. 
<ol start="4"> 
 <li>Declining Bitcoin Open Interest</li> 
</ol> 
Bitcoin’s Futures Open Interest has dropped by 5.17% in the past 24 hours, signaling a waning market confidence. The OI-weighted funding rate has also fallen sharply to 0.0085%. Despite this, Binance’s BTC/USDT Long-to-short ratio remains at 1.86, suggesting the market might see a rebound soon. 
The recent Bitcoin plunge highlights a convergence of factors—FOMC meeting delays, massive ETF outflows, and Mt. Gox Bitcoin distributions—causing a significant market shakeout. Despite a substantial dip, the market’s resilience, indicated by Binance’s long-to-short ratio, suggests a potential rebound. Could this downturn be a temporary setback, or is it the start of a more prolonged bearish trend? 
<blockquote class="wp-block-quote is-layout-flow wp-block-quote-is-layout-flow"> 
 Also Read: <a href="https://www.cryptotimes.io/2024/08/03/trump-suggests-bitcoin-as-solution-to-35t-national-debt/" target="_blank" rel="noreferrer noopener">Trump Suggests Bitcoin as Solution to $35T National Debt</a> 
</blockquote>

Bitcoin Dips 6%: Key Reasons Behind Today’s Decline

The Crypto Times

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