Bitcoin Drops to Two-Month Low Amid Ongoing Sell-Off Pressure

Arslan Butt

CryptocurrencyTrading
Bitcoin 1

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On Tuesday morning, Bitcoin (BTC-USD) experienced a significant downturn, reaching its lowest value since early December.

At 9:34 a.m. ET, the most prominent cryptocurrency in terms of market capitalization (BTC-USD) saw a 4.7% decrease, falling to $38.5K. This decline builds upon previous losses, amid dwindling trader enthusiasm following the recent greenlight for spot bitcoin exchange-traded funds (ETFs).

Since the launch of spot bitcoin ETFs in the U.S. on January 11, the digital currency has plunged about 15%. This downturn may be partly linked to the FTX (FTT-USD) bankruptcy proceedings, which resulted in the sale of most of its holdings in the Grayscale Bitcoin Trust Fund (GBTC) in the initial three days following GBTC’s shift to an ETF format.

This downward trend in bitcoin (BTC-USD) also dragged down other major cryptocurrencies. Ethereum (ETH-USD) fell by 8.4% to $2.16K, while Cardano (ADA-USD) decreased by 9.1%, Solana (SOL-USD) by 9.3%, and Ripple’s XRP (XRP-USD) by 5.8%.

Cryptocurrency-related stocks didn’t fare much better, with declines observed shortly after the stock market opened. MicroStrategy (MSTR) dropped by 4.1%, Marathon Digital (MARA) by 4.4%, Coinbase Global (COIN) by 5.1%, Riot Platforms (RIOT) by 3.7%, and Bakkt (BKKT) by 0.7%.

Performance of specific spot bitcoin ETFs varied: iShares Bitcoin Trust (IBIT) and Fidelity Wise Origin Bitcoin Fund (FBTC) declined by 3.8%, while Franklin Bitcoin ETF (EZBC) saw a 1% increase. Invesco Galaxy Bitcoin ETF (BTCO) and Valkyrie Bitcoin Fund (BRRR) both experienced a 3.6% drop.

In the realm of Bitcoin strategy tracking ETFs, ProShares Bitcoin Strategy ETF (BITO) decreased by 3.3%, Valkyrie Bitcoin Strategy ETF (BTF) by 6%, and VanEck Bitcoin Strategy ETF (XBTF) by 1%.