Bitcoin slides 6%, while altcoins sparkle
LONDON/SINGAPORE : Bitcoin fell by as much as 6.5 per cent on Tuesday, on track for its largest one-day drop in two weeks, as a wave of selling hit cryptocurrencies and other risk assets, such as stocks.
The price was last down 5.6 per cent at $63,650, having dropped to a two-week low of $62,966, while ether fell 6.7 per cent to $3,276.
Bitcoin is still showing a 52 per cent gain for the year so far, as investors have piled into U.S. exchange-traded funds backed by spot bitcoin.
The price hit a record high of nearly $74,000 on Thursday last week, which has triggered some profit-taking, along with a series of U.S. data releases that suggested the Federal Reserve may not cut interest rates this year as much as previously thought.
In the last week, bitcoin has fallen by nearly 9 per cent, set for its largest week-on-week decline since last September, while ether has lost 13 per cent following an upgrade to the underlying ethereum network.
But performance has not been as weak across the broader crypto complex.
Smaller tokens, known also as “altcoins”, have drawn in flows of their own. The solana network’s sol token has gained 19 per cent in the latest week, while avalanche’s avax coin has risen by 17 per cent, according to Coingecko.
“In light of bitcoin’s recent all-time high and subsequent correction, we anticipate a period of market recalibration as investors seek equilibrium amidst unprecedented inflows into spot bitcoin ETFs,” analysts at exchange Bitfinex said in a note.
In Tuesday’s U.S. premarket, shares of Coinbase slid 5.7 per cent, while crypto miners Riot Platforms and Marathon Digital fell 4.1 per cent and 6.6 per cent, respectively.
Shares in software firm and bitcoin buyer MicroStrategy dropped more than 10 per cent and the ProShares Bitcoin Strategy ETF fell 4.8 per cent.
Flows of capital into the 10 largest bitcoin ETFs have also slowed over the past few days.
According to LSEG data, $178 billion flowed into the major ETFs on Monday, compared with well over $400 billion on a number of days last week.
(Additional reporting by Shubham Batra in Bangalore; Editing by Harry Robertson, Christina Fincher and Louise Heavens)
