Bitcoin (BTC) price decline today can be attributed to several key factors:
1. Federal Open Market Committee (FOMC) meeting and expected interest rate hike: The market generally expects the US Federal Reserve to announce an interest rate hike at tomorrow's FOMC meeting to combat inflation. Such news usually leads to selling pressure on risky assets, including cryptocurrencies, as investors tend to turn to safer traditional assets in an environment of rising interest rates.
2. Increased risk aversion in the market: Due to expected market volatility, some people choose to transfer funds to stablecoins to avoid potential price volatility risks. This capital flow reduces the demand for Bitcoin, which has a negative impact on its price.
3. Crypto leverage market liquidation: In the past 24 hours, the total leverage liquidation in the cryptocurrency market exceeded $222 million. Leverage liquidation events often exacerbate market declines because they trigger automatic sell orders, further depressing prices.
4. Impact of the sentencing of Binance co-founder CZ: Although the “sentenced today” in the information may not match the actual situation, as there are no public reports indicating that Binance co-founder Zhao Changpeng (CZ) faces a real legal sentence, such negative news rumors about industry leaders can cause market panic, leading to a decline in investor confidence, thereby affecting BTC prices.
5. Hong Kong spot BTC and ETH ETFs get off to a slow start: Although Hong Kong approved and launched spot Bitcoin and Ethereum ETFs, their first-day trading volume was far below expectations, showing weak market demand. The lower trading activity reflects the market's lukewarm response to Bitcoin investment products, which may have weakened Bitcoin's appeal as an investable asset and, in turn, affected its price.
In summary, the decline in BTC prices is the result of multiple factors, including macroeconomic policy expectations, market risk aversion, leveraged liquidation events, uncertainties related to industry leaders, and the market performance of new financial products that is lower than expected.
