Crypto Market Downtrend: BTC Down 8% in Seven Days, Altcoins Follow Suit
The overall crypto market fell along with Bitcoin (BTC), which plunged to around $58,500 on Monday, extending its seven-day decline to more than 8%. The previous day saw a 1.09% increase in BTC, while majors SOL, BNB, XRP, and ADA saw a 3% decline. The broad-based CoinDesk 20 Index (CD20), a liquid ETF that tracks the largest tokens, increased by 0.91%, but DOGE lost 1.37%, leading to losses among cryptocurrencies.
U.S.-listed exchange-traded funds that track Bitcoin saw net outflows of $175 million on Friday, extending their losing run to four days. SoSoValue’s monitoring data reveals that despite $173 million in trading volume, ether ETFs saw no net inflows or outflows. Although several traders pointed out that the decline in Bitcoin is consistent with the bearish seasonality seen in September, they also said that the Federal Reserve’s interest rate reduction could buck the pattern.
Fed Rate Cuts Could Challenge Bitcoin’s Historical September Downtrend, Says Paybis Founder
In an email on Monday, Innokenty Isers, the creator of the cryptocurrency exchange Paybis, stated that September is historically a bad month for Bitcoin, with data indicating an average value depletion rate of 6.56%.
Should the Feds cut the interest rate in September, it might help Bitcoin re-write its negative history as rate cuts generally lead to excessive US dollar flow in the economy – further strengthening the outlook of bitcoin as a store of value.
Isers
The propensity of assets to undergo consistent, yearly variations that are predictable and regular is known as seasonality. Though seemingly arbitrary, potential explanations include profit-taking during the tax season in April and May, which leads to drawdowns, and the typically optimistic Santa Claus bounce in December, which indicates more demand.
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