As crypto/2024/03/19/bitcoin-slumps-62000-gbtc-fed-rate-cut-waiting-game/” target=”_blank” rel=”nofollow”>reported According to Fortune magazine, the cryptocurrency market has been experiencing significant volatility as bitcoin (btc) has experienced a sharp decline that has had a ripple impact on other cryptocurrencies. The recent drop in bitcoin price, coupled with capital outflows from Grayscale's GBTC, has raised concerns among investors.
bitcoin Sees 14% Correction From ATH
bitcoin suffered a 14% drop since it reached its peak its highest point (ATH) of $73,700 last week, briefly touching $62,483 on Tuesday morning. However, it recovered and stabilized around $64,900, just below the $65,000 mark.
The decline was attributed to record outflows of more than $640 million from Grayscale's bitcoin Trust (GBTC). By comparison, other bitcoin spot ETFs recorded inflows of less than $500 million, resulting in a net outflow of $15 million on Monday. according according to Bloomberg ETF expert James Seyffart.
This exit of GBTC, combined with the cautious sentiment surrounding the Federal Open Market Committee (FOMC) meeting in the US, has had a significant impact on bitcoin's performance.
Like recently reported According to NewsBTC, investors were cautious ahead of the FOMC meeting and closely monitored potential changes in interest rates. Recent higher-than-expected inflation data, as indicated by the US Consumer Price Index (CPI) and Producer Price Index (PPI), dampened expectations of interest rate cuts.
According to Fortune, the CME FedWatch tool projected a 99% chance of rates remaining unchanged, further affecting market sentiment. According to the report, investors were interested in assessing the Federal Reserve's stance on monetary policy, which contributed to the cautious trading environment.
In the same context, the Bank of Japan raised its key interest rate from -0.1% to 0% or 0.1% in response to rising consumer prices. This was the first rate increase in 17 years.
crypto Futures Traders Take a Hit
bitcoin's price drop had a cascading effect on other cryptocurrencies. Top altcoins like ethereum (eth) and Solana (SOL) saw significant drops of 8.1% and 12.5% in the last 24 hours, respectively.
Meme coins including Floki Inu (FLOKI), Bonk Inu (Bonk), and Dogecoin (DOGE) also suffered losses of 34%, 28.5%, and 24.8%, respectively, over the past week.
The drop in cryptocurrency prices resulted in more than $440 million in liquidations for crypto futures traders. Traders who had leveraged positions by betting on higher prices faced significant losses. The majority of these liquidations occurred on Binance, totaling $212 million, followed by OKX with $170 million.
Despite its price correction, btc retains substantial gains of over 26% and 132% over the past thirty days and year-to-date, respectively.
Featured image from Shutterstock, chart from TradingView.com
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