💥Big plunge, what happened to Bitcoin and altcoins

Recently, the Bitcoin and altcoin markets have experienced significant declines. What factors caused this decline? Here are the key reasons, let’s see what the impacts are! 👇

1️⃣ Google’s quantum computing technology breakthrough

Google's quantum chip Willow has made a breakthrough in the field of computing. If quantum computing is applied to Bitcoin mining, it will threaten the decentralized nature of Bitcoin. Miners will face greater competitive pressure, and the market is beginning to worry about the future of Bitcoin. 🔐

2️⃣ Microsoft refuses to invest in Bitcoin

Microsoft's board of directors voted down a proposal to invest 1% of its assets in Bitcoin. This decision intensified the market's caution about large companies investing in cryptocurrencies, and investor confidence was hit. 💼

3️⃣ The appreciation of the US dollar and the tightening of financial conditions

Since September, long-term bond yields and mortgage rates have risen, the dollar has strengthened and global money supplies have tightened. This makes crypto-assets represented by Bitcoin face greater macro risks. Normally, the appreciation of the US dollar is detrimental to cryptocurrencies. 💸

4️⃣ Market sentiment and capital flow

When the price of Bitcoin rises, institutions and market makers often conduct fund flows through the BTC/altcoin trading pair and transfer funds to Bitcoin, causing altcoins to face selling pressure. 📉

5️⃣ Powell’s hawkish remarks

Federal Reserve Chairman Powell recently reiterated that the Fed will continue to raise interest rates and achieve its 2% inflation target in the next 1-2 years. This means that U.S. dollar interest rates will remain high and inflows into the crypto market are suppressed, exacerbating the market's decline. 💥

6️⃣ Profit selling pressure

As cryptocurrencies such as Bitcoin rise, some investors and institutions choose to cash in profits when prices are higher, creating profit-taking selling pressure. This massive sell-off caused a short-term shock to the market, causing prices to fall back. 💸

7️⃣ The impact of Bitcoin ETF

Although the launch of Bitcoin ETF attracted more traditional investors, it also brought greater market volatility. The market has become more sensitive to the volatility of Bitcoin prices as capital inflows into Bitcoin ETFs may pose illiquidity risks. 📈