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Bitcoin Panic-sellers Are a Christmas Gift for Wealthy Traders

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Bitcoin panic-sellers are “practically giving away” their cryptocurrencies to wealthy buyers who will use the digital assets as an inflation shield, believes the CEO of a global financial giant.

The observation from deVere Group’s game-changing chief executive Nigel Green comes as Bitcoin and other leading cryptocurrencies steadied slightly ahead of the U.S. Federal Reserve’s meeting on Wednesday.

Digital currencies fell in price sharply earlier this month before regaining some ground.

Mr Green says: “The recent selloff was triggered by a wider risk-off sentiment that also impacted many areas of global stock markets.

“It occurred as inflation is running hot and, therefore, encouraging central banks to tighten monetary policies, putting at risk the liquidity that has benefitted a many asset classes, including Bitcoin.

“Wealthy crypto investors always buy in the dips. This is because they know that digital, global, borderless, decentralised money is, clearly, the future.

“Bitcoin has almost doubled in value since January 2021- how many other investments can say that? But this year was not without the crypto market’s trademark volatility.

“And the volatility is always used as buying opportunities by rich traders to top up their portfolios.

“Could this explain why so many of them send out ‘warning shots’ about selling crypto when things are a bit turbulent on social media? It seems very likely.

“Those Bitcoin panic sellers are practically giving away their cryptocurrencies to wealthy buyers who accumulate, accumulate, accumulate.”

He continues: “This scenario seems particularly likely in the current situation as they are increasingly worried that their cash, and therefore spending power, is being eroded by soaring inflation.

“Central banks – including The Fed which will make a key announcement on Wednesday – are now being forced to act in order to combat inflation.”

Bitcoin and other digital currencies are widely regarded as a shield against inflation mainly because of its limited supply, which is not influenced by its price.

“In this inflationary period, Bitcoin has outperformed gold, which has been almost universally hailed as the ultimate inflation hedge – until now,” says Mr Green.

To support his argument, he points to the fact that the third-largest holder of Bitcoin added more than $150 million of the cryptocurrency to their holdings following the recent flash crash. Figures from BitInfoCharts show that investors purchased more than 3,000 Bitcoins over the last few days.

He goes on to add: “Prices of Bitcoin and other cryptos can drop by 10% or more in a matter of hours. Indeed, they often do. This is why you need to have a properly diversified portfolio to mitigate risks.

“However, history shows that Bitcoin gains have been enormous for those who hold.”

The deVere CEO concludes: “Wealthy, long-term crypto investors typically benefit from spooked panic-sellers by buying their digital currencies on the cheap to enhance their investment portfolios.

“Doesn’t a Bitcoin price dip seem especially beneficial to those such investors during these times of worryingly high inflation?”

Is the CEO/Founder of Investors King Limited. A proven foreign exchange research analyst and a published author on Yahoo Finance, Businessinsider, Nasdaq, Entrepreneur.com, Investorplace, and many more. He has over two decades of experience in global financial markets.

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Bitcoin

Bitcoin Slumps to One-Month Low as Crypto Market Loses Steam

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The cryptocurrency market is facing a turbulent period, marked by significant declines and waning investor confidence.

Bitcoin, the leading digital asset, has dropped to a one-month low, trading at approximately $62,275 as of Monday morning in London.

This decline is part of a broader downturn in the crypto market, which has seen its second-worst weekly performance of 2024.

The overall gauge of the largest 100 digital assets fell by about 5% over the past week, according to data compiled by Bloomberg.

This represents the worst decline since April and highlights the growing concerns among investors regarding the future of digital currencies.

A key factor contributing to this downturn is the cooling demand for Bitcoin exchange-traded funds (ETFs).

Over the past six days, U.S. Bitcoin ETFs have experienced a consistent outflow of funds, undermining the confidence of investors who were hoping for a steady influx of capital into these investment vehicles.

This has compounded the already existing uncertainties surrounding the cryptocurrency market.

Adding to the market’s woes is the prevailing uncertainty over the Federal Reserve’s monetary policy.

Speculation about the Fed’s ability to cut interest rates from their current two-decade high has created a cloud of doubt over the entire financial market, including cryptocurrencies.

Analysts suggest that this uncertainty is dampening broader risk appetite, with investors becoming increasingly cautious about their investments in volatile assets like Bitcoin.

David Lawant, the head of research at FalconX, noted that the current crypto market dynamic is “characterized by low volatility, soft volumes, and order books getting unbalanced when prices start to move to the edges of their range.”

This imbalance has made the market more susceptible to sharp declines, as seen in the recent slump.

The declines in other major cryptocurrencies are also noteworthy. Ether and Solana have experienced their longest streaks of weekly declines since last year and 2022, respectively.

This comes despite preparations by fund companies to launch the first U.S. ETFs that invest directly in Ether, the second-ranked crypto asset. Solana, once a favorite among digital-asset hedge funds, has also seen significant drops.

Bitcoin, which hit a record high of $73,798 in March, is now trailing behind traditional assets such as stocks, bonds, and gold this quarter.

Analysts are now focusing on the 200-day moving average, currently at around $57,500, as a potential zone of support for Bitcoin’s price.

Tony Sycamore, a market analyst at IG Australia Pty, suggests that this level could provide some stability in the coming weeks.

As the cryptocurrency market navigates through these challenges, investors and analysts alike are keeping a close watch on any developments that could influence the market’s direction.

For now, the sentiment remains cautious, with many waiting to see if the recent declines will continue or if a recovery is on the horizon.

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Bitcoin (BTC) Holds Steady Above $70,900 as Grayscale Bitcoin Trust (GBTC) Outflows Increase

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Bitcoin (BTC) maintains its stronghold above $70,900 despite increasing outflows from the Grayscale Bitcoin Trust (GBTC).

As reported by CheckonChain, a total of $124.9 million flowed out of GBTC recently, contrasting with modest inflows into other investment vehicles like Fidelity’s FBTC and Bitwise’s BITB.

This trend has prompted speculation within the market regarding its impact on Bitcoin’s price dynamics.

While some believe that continued outflows from GBTC may exert selling pressure on BTC, driving down prices, others adopt a more cautious approach.

They argue that such outflows are expected from GBTC, given its relatively higher fee structure compared to alternative investment options.

Traders, however, seem to be pricing in a degree of stability for Bitcoin in the coming weeks, with optimistic forecasts on platforms like Polymarket.

According to predictions, there’s a 60% chance that BTC will reach $75,000 by the end of April, while the likelihood of it hitting $80,000 stands at 32%.

Despite the varying sentiments among market participants, Bitcoin’s resilience above the $70,900 mark underscores its status as a cornerstone asset in the crypto space.

Investors continue to monitor developments closely, navigating through the complex interplay of factors influencing Bitcoin’s price trajectory.

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Bitcoin Tests $66,000 Amidst Volatility Forecast

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As Bitcoin surged to a $66,000 price level during Asian trading hours, cryptocurrency markets brace for heightened volatility, with market observers predicting turbulent times ahead.

The cryptocurrency’s price volatility has been a subject of much discussion, particularly in light of recent events.

Semir Gabeljic, Director of Capital Formation at Pythagoras Investments, who highlighted the ongoing volatility cited a recent drawdown of 10% fueled by spot Bitcoin ETF outflows from GBTC, totaling approximately $300 million on March 20.

Gabeljic emphasized that such drawdowns typically occur in the lead-up to Bitcoin halving events, signaling a potential for increased volatility in the near future.

Meanwhile, the CoinDesk 20 (CD20), which tracks the world’s most liquid digital assets, experienced a minor dip of 0.5%.

However, amidst this overall market movement, CoinDesk’s Digitization Index (DTZ) saw a notable uptick, led by protocols like Ethereum Name Service (ENS), which rose by 2.7% during Asia trading hours.

Singapore-based trading firm QCP Capital noted the current consolidation in the market, with Bitcoin and Ethereum trading within a relatively tight range.

They suggested that the market might see a pause in activity over the weekend following the volatility leading up to the previous weekend’s Federal Open Market Committee (FOMC) meeting.

Also, QCP Capital highlighted the continued outflows from the Grayscale Bitcoin Trust (GBTC), expecting a fourth consecutive day of BTC spot exchange-traded fund net outflows.

The firm also pointed out a widening discount on Grayscale’s Ethereum Trust (ETHE) and the market’s diminishing expectations for the approval of a spot Ethereum ETF.

With Bitcoin’s test of $66,000 and ongoing market dynamics, cryptocurrency investors and analysts remain vigilant, anticipating further fluctuations in the days to come.

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