Bitcoin's recent rally has hit a roadblock, with the cryptocurrency falling below $69,000 per coin today.
Bitcoin's recent rally has hit a roadblock, with the cryptocurrency falling below $69,000 per coin today. While it has since recovered to above $70,000, it remains below its all-time high of $73,700 reached yesterday.
The dip is attributed to a combination of factors, including concerns over rising inflation and potential selling pressure from Grayscale. Data from the Labor Department's Bureau of Labor Statistics showed that consumer prices rose 0.4% last month, and 3.2% from last year, which is higher than expected. This has raised concerns that the Federal Reserve may not cut interest rates in May as anticipated, leading to a sell-off in digital assets and stocks.
Additionally, Grayscale has been moving a significant amount of Bitcoin to its custodian, Coinbase, potentially for selling. Arkham Intelligence data shows that Grayscale shifted around $400 million worth of Bitcoin to Coinbase today.
Grayscale's selling pressure stems from investors redeeming their holdings in its Bitcoin Trust ETF, which was converted from a closed-end fund in January. This has led to increased supply of Bitcoin in the market, putting downward pressure on the price. Despite the Grayscale redemptions, net inflows for other Bitcoin ETFs have reached a record high, indicating continued investor interest in the cryptocurrency.
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