Bitcoin price dropped by nearly 7% just two days after the spot ETF approvals. Cointelegraph investigates why BTC price is correcting.
Bitcoin price dropped by 6.8% between Jan. 11 and Jan. 12, confirming bears’ theory of a sell-the-news-style event occurring after the approval of a spot Bitcoin exchange-traded fund (ETF). The much-anticipated event ensued after a 75% rally in the 90 days leading to the initial trading on Jan. 11. This partially explains the lack of excitement and the subsequent price correction down to $43,180.
Traders are now questioning whether investors are becoming bearish after multiple failed attempts to break above $47,000 in the last week. On one hand, there is some rationale behind the fear, meaning market makers and whales that tried to front-run the spot ETF issuers by buying ahead of the launch might be forced to sell at a loss — if this hypothesis is valid. Furthermore, Bitcoin (BTC) miners might feel pressured to sell some of their holdings given that the halving is less than 100 days away.
Regardless of how profitable a Bitcoin mining operation is, a 50% cut in the block subsidy will significantly affect margins. According to Bitcoin News, miners’ outflow hit a six-year high as $1 billion worth of BTC was sent to exchanges.
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Source: https://cointelegraph.com/news/bitcoin-price-sells-off-after-etf-approval-have-investors-turned-bearish