BTC and cryptocurrency prices have plummeted this week, with a closely watched drop to around $58,400 per bit - leading traders to question whether it's time to "panic" after the money market electronics saw $350 billion evaporate.
BTC prices, which have soared this year as former president Donald Trump stoked fears of a US dollar collapse, have found a floor at just over $58,000 per bitcoin, supported by wild speculation that another tech billionaire may be about to start buying bitcoin .
Now, after analysts at the world’s largest asset manager BlackRock issued an “unprecedented” warning, bitcoin exchange-traded fund (ETF) data has revealed a “correction is really happening."
The group of U.S. bitcoin spot ETFs that have exploded on Wall Street this year suffered outflows totaling nearly $550 million last week, according to data from CoinShares, pushing fund outflows to as much as $550 million. more than 1.1 billion USD since mid-June.
“We believe this is a response to investor pessimism about the prospects of a Fed rate cut this year,” CoinShares head of research James Butterfill wrote in a report , adding that the latest outflows show that “a correction is indeed underway.”
The Federal Reserve has tempered expectations for interest rate cuts this year in recent months, with markets now expecting just one or two cuts in 2024, down from about seven. times at the beginning of the year.
Last week, BlackRock analysts warned that the Fed and other central banks around the world may be forced to keep interest rates higher than previously thought.
Analysts at BlackRock, which helped fuel this year's bitcoin price boom by leading the bitcoin spot ETF revolution on Wall Street, wrote: “We see central banks being forced to hold Interest rates are higher than before the pandemic to address persistent inflationary pressures.” in a report.
11 new bitcoin funds have skyrocketed to become some of the fastest-growing ETFs in Wall Street history since their approval in January. BlackRock's IBIT is leading the sector with nearly $20 billion in assets manage.
