Despite the significant milestone of launching 11 bitcoin exchange-traded funds (ETFs) in the U.S., crypto prices experienced a downturn. The BTC price crashed by more than 7% on Saturday, marking a contrast to the institutional acceptance it has fought for over the years. The market’s reaction following the ETF launch underscores cryptocurrency prices’ dynamic and sensitive nature.
Bitcoin’s Price Fluctuation
BTC’s price witnessed a notable drop of more than 7%, settling at $42,600. This decline erased the gains made earlier in the week and influenced a broader downturn in the crypto market. Notably, Bitcoin had briefly surged to $49,058.48 on Thursday, reaching its highest point since December 2021. Overall, the week concluded with a marginal 0.01% decrease for Bitcoin.
Ether’s Performance
Ether, on the other hand, saw a decrease of more than 3.7%, trimming its earlier gains. It had an impressive week, rising 15%, marking its first winning week in three and its strongest since March 2023. The shift in investor interest from Bitcoin to Ether post the ETF approvals contributed to this rise, with Ether hitting highs unseen since May 2022.
Analyst Insights and Market Reactions
Analysts like Alex Saunders of Citi observed a narrative shift in the crypto market, with Ethereum outperforming Bitcoin, possibly driven by anticipation of an ETF approval for Ethereum. The SEC is expected to make decisions on spot ETH ETF applications starting in May, with firms like BlackRock, Invesco, Ark, VanEck, and Grayscale in the running.
Market Expectations and Adjustments
The long-awaited Bitcoin ETF approvals were anticipated by many as a potential ‘sell-the-news’ event. The narrative surrounding ETFs had driven Bitcoin’s price up by over 60% in the past three months. While market participants are generally optimistic about the long-term impact of ETFs on Bitcoin’s price, the adjustment may take time as new entrants gradually familiarize themselves with the asset.
Other Cryptocurrencies and Crypto Equities
Litecoin, with a value proposition akin to Bitcoin’s original vision, emerged as a bright spot in the crypto market, heading for an 11% weekly gain. Crypto equities, however, mirrored Bitcoin’s downturn, with notable declines in companies like Coinbase and MicroStrategy, as well as among various crypto miners.
