Bitcoin price slips below $56,000; Ether, Solana, other cryptos down up to 15%

Bitcoin price traded lower on Friday, falling for the fourth consecutive trading session, dragged by wider selloff in cryptocurrencies.

Bitcoin price was at $55,510, down 5.82% over the past 24 hours, with the tokens market capitalization at $1.11 trillion. So far this year, Bitcoin price has rallied 35.39%.

Among other digital assets, smaller coins like Ethereum prices fell 8.4% to $2,954.16, Solana was down 9.55% to $123.08 and XRP declined 12.48% to $0.400.

Bitcoin price hit an all-time high of $73,798 in March, buoyed by strong demand for inaugural US Bitcoin exchange-traded funds. However, the inflows in the token ETF have since ebbed, weighing on the Bitcoin prices. Moreover, approvals for debut US ETFs for second largest token Ether are pending.

Crypto prices were pressurized by falling demand for US Bitcoin exchange-traded funds. The political developments in the US and signs that governments are disposing of seized tokens also weighed on Bitcoin prices.

“Bitcoin (BTC) experienced a wave of liquidations totaling $121.29 million as long positions were forced to close amid mounting losses. Over the past month, Bitcoin has fallen by 15%, reflecting heightened market volatility and bearish sentiment. There can be additional resistance to reach the $60k levels as bears dominate the market due to liquidations, whale movements, miner sell offs, etc. The asset sell off by the German government are adding to the volatility in BTC,” said Rajagopal Menon, VP, WazirX.

According to a Bloomberg report, administrators of the failed Mt. Gox exchange are returning a hoard of Bitcoin to creditors in stages. Speculators are uncertain how much of the $8 billion haul will end up being sold. A Mt. Gox-linked wallet moved $2.7 billion worth of the token on Friday, according to Arkham Intelligence.

On the other hand, global equity markets have rallied and the MSCI Inc.’s gauge of global stocks is hovering near a record high. A short-term, 30-day correlation between Bitcoin and the index is plunging.

Investors are awaiting the US nonfarm payrolls data to be released later today for the outlook on the US Federal Reserve’s potential interest rate cuts. Weak economic data in the US have bolstered the case for the Fed rate cut in coming months.

“US Federal Reserve Chair has hinted at larger than anticipated rate cuts but there is no timeline as for when it will happen. This scenario is viewed as bullish for Bitcoin and major altcoins. Additionally easing of miner sell off could ease the pressure on the market in the coming weeks,” Menon said.

(With inputs from Bloomberg)

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