The Bitcoin and Ethereum prices are experiencing another downturn, as the crypto market struggles to achieve a ‘Santa rally’ akin to other significant assets. This development occurs as BTC and ETH grapple with considerable selling pressure from crypto ETFs, which are experiencing ongoing outflows. The prices of Bitcoin and Ethereum have dipped once more, facing selling pressure stemming from the BTC and ETH ETFs. Data reveals that BlackRock made a significant move yesterday, depositing 2,292 BTC valued at $200 million and 9,976 ETH worth $29 million into Coinbase, presumably to sell these assets. This was the second instance this week where the world’s largest asset manager transferred BTC and ETH to Coinbase in an effort to offload these cryptocurrencies.
Recent insights reveal that BlackRock made a significant deposit of 2,838.78 Bitcoin, valued at $255 million, along with 29,928 Ethereum, amounting to $91.29 million, into Coinbase on December 22. The recent sell-offs coincide with notable outflows from crypto ETFs. This week, BTC ETFs experienced a total net outflow of $330 million, whereas ETH ETFs recorded a weekly net outflow of $11 million. This suggests that the institutional interest in Bitcoin and Ethereum is currently diminishing, leading to a bearish perspective for the largest crypto assets by market cap.
A report released earlier this week disclosed that Bitcoin ETFs experienced outflows totaling $460 million last week, while Ethereum ETPs faced outflows of $555 million. From a macro perspective, Bitcoin and Ethereum prices have continued their downward trend as the Fed appears unlikely to reduce interest rates at the upcoming January FOMC meeting. The latest U.S. GDP and jobless claims reports have ignited a rise in the likelihood that the Fed will maintain rates next month.
A recent analysis indicates that the risk of a bear market is increasingly significant, as evidenced. The BCMI currently stands below equilibrium, yet remains significantly above historical bottom zones. This indicates that there remains potential for the BTC price to decline further. According to the analysis, data suggests that Bitcoin may be entering a bear phase rather than merely undergoing a pullback. Should history be a guide, BTC is anticipated to establish a more resilient bottom if the BCMI returns to the levels observed between 2019 and 2023. The analysis highlighted that this is a scenario worth considering, as currently, the market seems to be in a downward transition rather than having undergone a complete reset. Currently, Bitcoin is priced at approximately $87,700, reflecting a decline over the past 24 hours.