Bitcoin fell to $60,000 in February and has since risen, but the sharp drop in June brought it below that level.
Bitcoin’s sudden drop from $83,000 in May to $60,000 is likely due to factors such as Fed expectations, ETF outflows, and Strategy’s Bitcoin sales forecast.
Here, Grayscale, the world’s largest virtual currency fund company, analyzed the reasons for Bitcoin’s decline and listed its future predictions.
In a recent report, Grayscale cited four main reasons for Bitcoin’s decline. First, they said, is a change in expectations about the Federal Reserve.
Analysts say the market was expecting a Fed rate cut at the beginning of the year, but even a rate hike is now on the table.
The second reason cited for the decline was delays and uncertainty surrounding the US Clarity Act, which is seen as bullish for cryptocurrencies.
“…the much-anticipated Clarity Act has yet to be passed, and its chances of passing are decreasing by the day. As a result, a wait-and-see attitude prevails in the market.”
If this law is passed, business investment is expected to increase significantly. ”
Analysts point out that: $BTC The third reason is the sales and subsequent decline in stock prices of Bitcoin’s largest institutional investor, Strategy, Inc., and finally, quantum concerns are also thought to have spurred the decline.
Despite Bitcoin’s sharp decline, Graycycle analysts said they remain incredibly optimistic about Bitcoin and cryptocurrencies in the medium to long term.
At the moment, analysts are claiming that the passage of transparency laws in the US and the Federal Reserve’s monetary policy are key variables that will determine Bitcoin’s future price.
Analysts suggest that if the Bitcoin and Altcoin Transparency Act passes the Senate, it will strengthen Strategy’s financial structure and the Fed will stop raising interest rates. $BTC We may be nearing the bottom.
“…But on the flip side, if this bill doesn’t pass this year, Strategy’s risk won’t be reduced, and if the Fed raises interest rates due to inflation. $BTC It is possible that it will fall further. ”
*This is not investment advice.
