Bitcoin (BTC) has experienced a significant
decline of 7.5% since the start of the week, falling to $63,000. This drop
marks a 15.5% decrease from its recent all-time high of $73,864.
The decline in Bitcoin prices has been
notable, with a particularly shocking flash crash occurring on BitMEX exchange
where prices briefly plummeted to $8,900 per coin. This sudden drop was
triggered by a large sell order of 850 BTC worth $55 million, causing prices to
crash within minutes before swiftly rebounding back to around $67,000 per coin.
While this incident was not a technical failure, it highlights the
vulnerability of the market to significant sell-offs.
Sentiment in the crypto market is deteriorating,
with concerns mounting about the potential rejection of spot Ethereum-ETF
applications by the U.S. Securities and Exchange Commission (SEC) in May. This
news contrasts with earlier expectations of approval and has contributed to a
negative outlook among investors.
Capital outflows from spot BTC-ETFs have
further fueled the decline in Bitcoin prices, with significant withdrawals
reported across various funds. Grayscale Bitcoin Trust (GBTC) experienced its
largest-ever outflow since its launch, leading to forced liquidation of
positions totaling $511 million on Tuesday.
Despite the recent correction, a support level
for BTC has been established at $58,000-60,000, providing some stability for
now. However, if the downside momentum persists, this support may not hold,
potentially leading to further declines towards $50,000 per coin. Monitoring
capital flows into spot BTC-ETFs will be crucial to get the direction of future
price movements.