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June 19, 2024

Bitcoin Hits One-Month Low: Why Now Could Be The Perfect Entry Point

June 19, 2024

Bitcoin has plunged to its lowest value in a month, driven by a substantial sell-off in altcoins and significant outflows from Bitcoin spot ETFs. 

The altcoin market’s turbulence and ETF outflows are weighing on Bitcoin’s price trajectory. 

However, it’s crucial to consider the broader historical context, especially given that we are now two months post-Bitcoin Halving, and current price action is mirroring trends seen in previous 60-day post-halving periods. 

In this article we’ll explore how these factors, and more, could indicate that now is the perfect time to consider entering the market.

Bitcoin and Major Altcoins Decline

Bitcoin’s price dropped to approximately $64,500 during early Asian trading hours after reaching a high of $67,000. The drop follows three consecutive trading days marked by outflows from Bitcoin ETFs. 

This decline in BTC is mirrored by major cryptocurrencies like Ethereum (ETH) which is fighting to hold on the its blockbuster gains from this month, ETH remains up 14% month-on-month on the back of news of the recent ETH ETF approvals, but ETH prices remain extremely volatile.

Factors Behind the Drop: Altcoin Unlocks and Market Reactions

The recent downturn in altcoin prices could be attributed to significant token unlocks last week. Digital assets such as Aptos, IMX, Starknet, SEI, and Arbitrum saw unlocks amounting to $483 million. 

This massive release of tokens prompted venture capital investors to sell off their holdings, creating downward pressure on the entire cryptocurrency market, including Bitcoin, and leading to markets failing to rally despite weak inflation data.

Significant Liquidations Across the Crypto Market

According to Coinglass data, recent price movements resulted in liquidations totaling $455 million across all assets from over 172,000 crypto traders in the past day. 

Long traders bore the brunt of these losses, with $393 million liquidated, while short traders saw $62 million liquidated. Ethereum traders faced substantial losses, accounting for roughly $92 million, or 20% of the total liquidations. Those betting on ETH price increases lost $75 million, while $16 million was liquidated from short-position holders.

Bitcoin also experienced significant liquidations, with $47.43 million in long positions and $22.71 million in short positions liquidated. 

The liquidations go to show why buying and holding crypto is a far safer strategy than betting on short-term moves.

Post-Halving Trends: A Historical Perspective

We are now two months on from the Bitcoin Halving, a pivotal event that reduces the reward for mining new blocks by half, effectively decreasing the rate at which new bitcoins are created. 

Historically, Bitcoin’s price has exploded in the period following halvings.

Mirroring Previous Post-Halving Trends

Current price action is mirroring trends seen in previous 60-day post-halving periods. After the 2016 and 2020 halvings, Bitcoin saw significant price increases start to take off as early as approximately two months post-halving, setting the stage for dramatic bull runs. 

If history is any indication, we might be on the cusp of another major price surge.

Bitcoin 10-Year Price Chart Illustrating Bitcoin Halving Dates Preceding Bitcoin Bull Runs Via RektCapital
Bitcoin 10-Year Price Chart Illustrating Bitcoin Halving Dates Preceding Bitcoin Bull Runs Via RektCapital

Is History Set to Repeat Itself?

The consistent pattern of Bitcoin’s price behavior post-halving fuels speculation that another price explosion is imminent. 

Investors and analysts alike are gearing up for what could be a monumental rise in Bitcoin’s value.

Get Ready for the Ride of Your Life! 

With Bitcoin’s historical performance as a guide, current market conditions suggest the possibility of a bullish breakout. 

Despite recent declines, the post-halving period traditionally heralds a new phase of growth. If past trends hold true, investors should prepare for significant upward momentum.

Ethereum Supply and Upcoming ETFs: A Massive Supply Shock

Adding another layer to the market dynamics is the current state of Ethereum. ETH supply on centralized exchanges (CEXs) has reached an 8-year low, with only 10% of its circulating supply available on these platforms. 

This dramatic decrease in supply is critical as it coincides with the anticipated launch of ETH ETFs in two weeks. 

This has led to widespread speculation that a major ETH supply shock is imminent!

Tweet Warning of ETH Supply Shock by Lark Davis
Tweet Warning of ETH Supply Shock by Lark Davis

Institutional Influx

The launch of ETH ETFs is expected to bring in substantial institutional money, potentially leading to a massive supply shock. 

With limited ETH available on exchanges and a surge in demand from institutional investors on the horizon, prices could soon skyrocket.

Why Now Could Be the Perfect Entry Point

Bitcoin’s dip to a one-month low amid a broader altcoin sell-off and significant liquidations offers a massive buying opportunity for value investors. 

The post-halving period historically leads to price surges and with Ethereum poised for a massive supply shock with the upcoming ETF launch, markets have rarely looked so bullish. 

The current market conditions suggest that now could be the perfect entry point for savvy investors. 

Prepare for what could be a historic rise in Bitcoin and Ethereum’s value – get ready for the ride of your life!

Key Takeaways for Crypto Investors

  1. Impact of Token Unlocks: Large-scale token unlocks can create downward pressure on the market as investors look to liquidate their holdings. 
  2. Post-Halving Trends: Historical trends suggest that Bitcoin may experience a significant price surge over coming months and years.
  3. ETH Supply Shock: The upcoming ETH ETFs and the current low supply on exchanges indicate a potential surge in Ethereum’s price and the broader market due to increased demand.

Why Timing Matters

Entering the market during periods of decline can offer lower entry points, allowing you to capitalize on future price increases. 

With Bitcoin’s historical strong post-halving performance and Ethereum’s anticipated supply shock, the current dip might just be the perfect time to invest!

As always, this article does not constitute financial advice. You should be sure to do your own research and consult a professional financial advisor before making a major investment decision.

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