The current dip in Bitcoin BTC bears some parallels to the cryptocurrency's behavior following the debut of the US ETF in January. A trader has indicated that this could indicate an upsurge in the "next week or so."
Exchange-traded funds (ETFs) for spot bitcoin were introduced in Hong Kong on April 30 and have since had net inflows of $217 million. Nevertheless, CoinMarketCap data shows that since introduction, the price of Bitcoin has decreased by over 7%.
Quinten Francois, co-founder of WhereAt Social and an experienced cryptocurrency trader, stated that the behavior is comparable to the introduction of spot Bitcoin ETFs in the US, when the price of the cryptocurrency dropped 14% in the first 12 days of the offering before increasing 7% in the next seven.
According to Francois, in a post published on May 1 on X, there might be an uptick in the price of Bitcoin "in the next week or so" if the trend continues.
"There isn't a clear path to success. Price adjustment was definitely necessary, the anonymous cryptocurrency trader StockLizard continued.
Nonetheless, the two launches differ significantly in a few important ways. Since their introduction, Hong Kong Bitcoin ETFs have seen net inflows of $217 million; nevertheless, U.S. During the same time frame, ETF outflows totaled $794 million.
In contrast to the $4.6 billion first-day trading volume of U.S. spot Bitcoin ETFs, the Hong Kong-based ETFs only garnered $12.4 million in trading activity on their first day of operation.
The introduction of Hong Kong's ETF also coincides with the halving of Bitcoin, which frequently triggers a period of "sideways" price activity. Other recent events include ongoing elevated tensions in the Middle East and the US Federal Reserve's decision to prolong its interest rate hike program.
In a post on April 30, Bloomberg ETF analyst Eric Balchunas asserted that this is a high number, pointing out that Hong Kong is just "1/168th the size of the U.S."
Some traders fear that the substantial withdrawals from the U.S. in recent times may be offset by inflows from Hong Kong, which could prevent a similar breakout pattern.
However, other traders think that the current drop in price is actually a healthy correction of the market for the price of Bitcoin.
Investor Titan of Crypto wrote on X that "the higher its price will meet the trendline, the longer the Bitcoin consolidation takes."
"The recent correction in Bitcoin was much needed for the price going forward," cryptocurrency analyst CryptoCon continued.
AirBtc founder Handre van Heerden echoed, saying, "The thing Bitcoin critics don't understand is that we simply don't care if the price drops."
May 2024, Cryptoniteuae