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<p>Bitcoin (BTC) experienced a sharp decline, falling below $59,000 as the U.S. business day ended, with the cryptocurrency shedding 6.5% in value over the last 24 hours.</p> 
<p>Earlier in the day, <a href="https://crypto.ro/en/cryptocurrencies/bitcoin/">Bitcoin</a> had briefly surpassed $62,700 before dropping to as low as $58,240, its lowest point since August 19. Ethereum’s ether (ETH) also faced significant losses, falling nearly 10% to trade below $2,500 after reaching $2,700 earlier in the day.</p> 
<figure id="attachment_49549" aria-describedby="caption-attachment-49549" style="width: 100%" class="wp-caption alignnone">
 <img loading="lazy" decoding="async" class="wp-image-49549 size-full" src="https://crypto.ro/en/wp-content/uploads/2024/08/BTCUSD_2024-08-28_11-49-01.webp" alt="BTCUSDT 1H | TradingView" width="1534" height="857" title="Why is Bitcoin Down Today? 12" srcset="https://crypto.ro/en/wp-content/uploads/2024/08/BTCUSD_2024-08-28_11-49-01.webp 1534w, https://crypto.ro/en/wp-content/uploads/2024/08/BTCUSD_2024-08-28_11-49-01-300x168.webp 300w, https://crypto.ro/en/wp-content/uploads/2024/08/BTCUSD_2024-08-28_11-49-01-1024x572.webp 1024w, https://crypto.ro/en/wp-content/uploads/2024/08/BTCUSD_2024-08-28_11-49-01-768x429.webp 768w, https://crypto.ro/en/wp-content/uploads/2024/08/BTCUSD_2024-08-28_11-49-01-750x419.webp 750w, https://crypto.ro/en/wp-content/uploads/2024/08/BTCUSD_2024-08-28_11-49-01-1140x637.webp 1140w" sizes="(max-width: 1534px) 100vw, 1534px">
 <figcaption id="caption-attachment-49549" class="wp-caption-text">
  BTCUSDT 1H | TradingView
 </figcaption>
</figure> 
<h3 id="1-major-liquidations-in-the-crypto-market">1. Major Liquidations in the Crypto Market</h3> 
<p>The abrupt downturn in the cryptocurrency market triggered substantial liquidations of leveraged crypto derivatives positions. Over the past 24 hours, approximately $313 million in positions were liquidated, marking the most considerable washout since the market crash on August 5, according to data from <a href="https://www.coinglass.com/LiquidationData" rel="nofollow noopener" target="_blank">CoinGlass</a>.</p> 
<p><img loading="lazy" decoding="async" class="size-full wp-image-49551 alignnone" src="https://crypto.ro/en/wp-content/uploads/2024/08/image_2024-08-28_11-51-59.png" alt="image 2024 08 28 11 51 59" width="706" height="429" title="Why is Bitcoin Down Today? 13"></p> 
<p>Bitcoin traders accounted for $95 million in liquidations, while Ethereum traders faced over $100 million in losses. These liquidations, resulting from leveraged positions being forcefully closed, often exacerbate price declines as assets are sold off to cover losses, further pushing prices downward.</p> 
<h3 id="2-decline-in-bitcoin-network-activity">2. Decline in Bitcoin Network Activity</h3> 
<p>Decreased activity on the Bitcoin network has also been linked to the recent price weakness. Glassnode data reveals that the number of active Bitcoin addresses—wallets either sending or receiving BTC—has declined. For the week ending August 26, the seven-day average of active addresses dropped to 668,732, a 4% decrease from two weeks prior and the lowest level observed in two months. This reduction in active addresses suggests a slowdown in retail investor activity, which can dampen overall market sentiment.</p> 
<figure style="width: 100%" class="wp-caption alignnone">
 <img loading="lazy" decoding="async" src="https://s3.cointelegraph.com/uploads/2024-08/9312ebf4-3d8c-48e2-b916-f8562b740e7e.png" alt="Bitcoin 7-day average active addresses. Source: Glassnode" width="1527" height="730" title="Why is Bitcoin Down Today? 14">
 <figcaption class="wp-caption-text">
  Bitcoin 7-day average active addresses. Source: Glassnode
 </figcaption>
</figure> 
<p>Additionally, the median transfer volume on the Bitcoin network, measured over a seven-day average, has decreased to 0.00376 BTC. This figure represents the lowest median transfer volume since December 2023, indicating that fewer transactions of smaller amounts are occurring. Both factors signal reduced engagement on the Bitcoin network, which could be contributing to the decline in investor appetite.</p> 
<figure style="width: 100%" class="wp-caption alignnone">
 <img loading="lazy" decoding="async" src="https://s3.cointelegraph.com/uploads/2024-08/4e48dd0e-a6d3-4c67-ab94-f070ffdf6f8a.png" alt="Bitcoin median transfer volume, 7-day average, BTC. Source: Glassnode" width="1449" height="672" title="Why is Bitcoin Down Today? 15">
 <figcaption class="wp-caption-text">
  Bitcoin median transfer volume, 7-day average, BTC. Source: Glassnode
 </figcaption>
</figure> 
<h3 id="3-reduced-probability-of-u-s-federal-reserve-rate-cuts">3. Reduced Probability of U.S. Federal Reserve Rate Cuts</h3> 
<p>Macroeconomic factors are also at play, with reduced expectations for a significant rate cut by the U.S. Federal Reserve contributing to investor caution. The likelihood of a 0.50% or 0.75% interest rate cut by year-end has diminished amid persistent inflationary concerns. This shift in market sentiment is likely causing increased risk aversion among investors. The reduced probability of rate cuts implies that monetary policy may remain tight, limiting liquidity in financial markets and reducing speculative investments, including those in cryptocurrencies like Bitcoin.</p> 
<p>In conclusion, Bitcoin’s recent downturn can be attributed to a combination of substantial liquidations, declining network activity, and macroeconomic uncertainty regarding U.S. monetary policy. These factors collectively weigh on investor sentiment and contribute to the current bearish trend in the cryptocurrency market.</p>

Why is Bitcoin Down Today?

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