K33 Research: The risk of continued amplification of downward volatility due to long-term liquidation is still considerable
According to citing Bloomberg, Bitcoin has been hovering around its lowest level in about two weeks due to a decrease in funds flowing into spot Bitcoin ETFs and concerns that the scope of the US interest rate cut is shrinking. Since reaching a historical high of nearly $73,798 on March 14th, cryptocurrencies have been falling almost every day, raising questions about whether this type of cryptocurrency has temporarily peaked. At the same time, there is uncertainty as to whether higher-than-target inflation will lead to a downgrading of interest rate expectations by Federal Reserve policymakers at Wednesday's meeting, which suggests that the environment for speculative investments is not very favorable.
Meanwhile, demand for the US spot Bitcoin ETF launched on January 11th has cooled off. These products have so far received a net inflow of $11.6 billion, but investors withdrew from the group on Monday.
According to data from CoinGecko, since the total market value of cryptocurrencies reached $2.9 trillion last week, the current market value of cryptocurrencies has fallen to $2.45 trillion. K33 Research said that bullish bets using derivatives may face further shocks, indicating that the rapid recovery of the digital asset market may encounter obstacles. Therefore, the risk of long-term liquidation leading to continued downward volatility remains quite high.
Disclaimer: The content of this article solely reflects the author's opinion and does not represent the platform in any capacity. This article is not intended to serve as a reference for making investment decisions.
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