Bitcoin futures and options indicate that the recent decline in the price of BTC to $61,500 had no appreciable effect on investor confidence. The 13.3% decline in the price of Bitcoin (BTC) from $62,621 on April 12 to April 13 drove away a lot of traders, mostly those who had leveraged their holdings. This huge shift resulted in forced long position liquidations of $387 million and a $5.4 billion decrease in open interest. The price movement and its impact on the futures markets appear to indicate a reduction in risk appetite at first look. However, traders in cryptocurrencies are used to volatility and frequently overreact when things are unclear.
To find out if the retest of $61,500 was enough to cause panic or if it indicates that there is less chance of an all-time high of $72,000 following the halving of Bitcoin, a closer look is required.
Has Bitcoin Failed To Deliver A Trustworthy Means Of Storing Value?
Even with the little rebound to $63,500 on April 15, traders’ general mood has soured, making it difficult to maintain the narrative that portrays BTC as “digital gold.” The price volatility also revealed flaws in the spot BTC ETF, especially as investors were unable to liquidate their holdings over the weekend. The limitations of indirect exposure to Bitcoin through these kinds of securities were made clear by this circumstance. Bitcoin’s price has been greatly impacted by recent inflows into U.S. spot ETFs, even after taking withdrawals from Grayscale’s GBTC. In only three months, the industry has grown to handle $55 billion in assets, helped by high-profile visits to institutional customers and major asset managers by sales teams from BlackRock, Fidelity, Bitwise, and VanEck.
