Bitcoin price below $40,000: Will it lead to a new market crash?
Bitcoin price below $40,000: Will it lead to a new market crash?
The price of Bitcoin (BTC), the largest cryptocurrency by capitalization, has fallen about 20% since Jan 11, 2024, when the first US spot Bitcoin ETFs were launched, reaching below $40,000 for the first time since Dec 3, 2023.
Experts also point to continued pressure on Bitcoin from investors exiting GBTC. Analyst J. Terry accused Grayscale's management of greed for keeping the fee on GBTC at 1.5%, while most other issuers have set it between 0.2% and 0.4%. This resulted in investors pulling $2.8 billion out of GBTC, while about $4 billion was invested in other ETFs.
On the launch day of the spot Bitcoin ETFs, the price of BTC reached $49,021, but collapsed to $39,718 on January 23, 2024. Currently, Bitcoin has recovered some of its losses and is trading around $40,145, down 2.73% in the last 24 hours.
According to CoinGape, more than $225 million worth of positions have been liquidated in the cryptocurrency market in the last 24 hours, mainly due to the collapse in the price of BTC.
Many cryptocurrency market participants believe that Bitcoin has also recently faced problems due to tightening macroeconomic conditions, as evidenced by rising interest rates and a stronger dollar.
Sean Farrell of Fundstrat Global Advisors LLC stated that "the heavy selling pressure on GBTC may soon subside".
Mike Novogratz, founder and principal of Galaxy Digital, responded to a post on X (Twitter) by J. Terry and wrote that most investors liquidating positions in Grayscale's GBTC will move their funds into other Bitcoin ETFs, which will neutralize the current weakness of the largest cryptocurrency.
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Mike Novogratz has long been known for his commitment to Bitcoin. He predicted a BTC price of $500,000 in 2022 and $69,000 in 2023. Now he believes that the "first" cryptocurrency will resume its growth within 6 months.
Related: Grayscale Investments has sold over 52,000 BTC since Jan 11
