The decline in total trading volume to $63.63 billion suggests a sluggish cryptocurrency market, corroborated by the remaining variables. In just one day, the TV fell 17%, and the value of the entire cryptocurrency market fell to $2.3 trillion. In addition, the fear and greed index has moved against the bulls.
The outcome of the market downturn is the reduction of Bitcoin and Ethereum values, along with many other popular cryptocurrencies. Bitcoin is currency trading at $62,309.95 after a 2% fall, and Ethereum price is trading at $ 2,999.41 after a 2.2% fall. For now, the slide will continue, driving down the value of the other cryptocurrencies.
Reasons of the Decline in the Crypto Market Today
After weeks of sideways movement, the cryptocurrency market has only recently shown a slight uptick. However, the dip that occurred today due to recent regulatory concerns has also disrupted that. Apart from that, a drop in exchange inflows and the Bitcoin Futures ETF have depressed investor sentiment and created bearish circumstances.
SEC Meddling in the Cryptocurrency Market
Since the exchange received a Wells notice from these US regulators, Robinhood has emerged as the SEC’s next target. In a filing on Monday, Robinhood recently made this information public. It stated,
Consequently, the exchange has chosen to stop trading any cryptocurrency that the SEC has labeled or identified as security. Robinhood has previously stopped supporting cryptocurrency. Previously, Cardano, Solana, and Polygon were removed by Robinhood as soon as the SEC became involved with Binance and Coinbase and labeled them as securities.
On May 4, 2024, RHC received a ‘Wells Notice’ from the Staff of the SEC (the ‘Staff’) stating that the Staff has advised RHC that it made a ‘preliminary determination’ to recommend that the SEC file an enforcement action against RHC alleging violations of Sections 15(a) and 17A of the Securities Exchange Act of 1934, as amended
Future Bitcoin ETF Outflows in Consecutive
This past week was the fourth consecutive week of rising withdrawals from the cryptocurrency market, with a $251 million decrease in AUM (Assets Under Management). Even after the Ethereum and Bitcoin ETFs launch in Hong Kong, these withdrawals have persisted. These maximum outflows were noticed in the case of Bitcoin, as $284 million got pulled from funds.
The popularity of the Bitcoin ETF has declined due to the ongoing outflows, which directly affect the price of Bitcoin.
In contrast, Ethereum broke its week-long stretch of outflows with a record $30 million in inflows. Thus, the total inflow rate was US$307 M during just the first week of the launch of these Hong Kong ETFs.
Decade-Low Exchange Bitcoin Inflow Rate
In addition to the losses in the inflow of Bitcoin ETFs, the exchange inflow has fallen to its lowest level in ten years. For example, in 2015, the Bitcoin exchange inflow value was only 20K BTC. In addition, the long-term holders have stopped the distribution to reamble Bitcoin.
The number of people wanting to sell BTC has been decreasing since February 2018. The MA-365D Exchange Inflow has dropped from 90K to 36K.
The current trend for Bitcoin Exchange Inflow is 20K BTC, a similar situation occurred in 2015.#deficit pic.twitter.com/YGNUOPBWqj
— Axel 💎🙌 Adler Jr (@AxelAdlerJr) May 6, 2024
As Bitcoin moves closer to an accumulation zone, the cryptocurrency market may experience a complete collapse. A few analysts have spoken of the probability of Bitcoin crossing the $50K mark before returning to an all-time high.
