The crypto market has experienced an intense bearish trend in the past few days, with BTC price dropping to $86,000 on fears of monetary uncertainties
Bitcoin (BTC) has recently fallen below $89,000, reaching its lowest level in three months. This drop reflects a general trend in the market, where investors are becoming more cautious, especially in the stock markets.
Nasdaq futures also show a careful outlook as investors expect continued volatility, leading to a more risk-averse sentiment across financial markets.
Bitcoin Price Reduction is Linked to Several Factors
The risk aversion is also evident in the strength of the Japanese yen, which has risen against the United States dollar.
This rise in the yen is usually seen as a safe choice, reflecting investors’ desire for more stable options during uncertain global economic times. As a result, the increase in the yen shows a clear move away from riskier investments like Bitcoin and stocks.
Undoubtedly, Bitcoin’s recent decline is linked to the global economy, which has been affected by stricter monetary policies and a reduction in money supply.
Earlier this year, central banks, including the U.S. Federal Reserve, adopted hawkish policies toward interest rates and reduced liquidity to control inflation. These actions have cooled interest in speculative assets, and Bitcoin is no exception.
Furthermore, Bitcoin’s lack of sustained bullish catalysts has made it prone to short-term downward pressure. As investors turn to more stable options amid growing global uncertainties, Bitcoin’s resilience will likely be tested further in the coming months.
Meanwhile, the BTC funding rates, a fundamental mechanism in the perpetual futures market, also flipped in January.
This trend, which may indicate a disturbing signal for Bitcoin bulls, follows Wall Street’s tech Nasdaq futures 700 points drop. It is worth noting that the funding rate balances the ratio between long and short positions in the perpetual futures market.
The 21 Rules of Bitcoin
Amid the broader market outlook, Michael Saylor, Bitcoin evangelist and Executive Chairman of Strategy, has shared his personal “21 Rules of Bitcoin.”
These rules outlined Saylor’s approach to Bitcoin as a guide to new and experienced investors. Amongst the rules, Saylor advocated for a long-term holding plan, suggesting that Bitcoin’s value would appreciate over time as adoption grew.
In November 2024, Saylor also outlined the Bitcoin principles that have fueled his company’s growth. Saylor said that the company does not just buy Bitcoin; it hoards it indefinitely.
Furthermore, Saylor wants to create Bitcoin-backed securities, taking advantage of the coin’s growing acceptance among mainstream finance players.
He emphasized that a solid financial foundation is crucial for supporting his company’s Bitcoin strategy and maintaining stability. Ultimately, Strategy promotes Bitcoin as a valuable reserve asset for the long term.
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