Aug. 5, Reuters Monday saw a sharp decline in bitcoin and ether to multi-month lows as investors flocked to safe-haven assets amid fears of a potential U.S. recession following weak data.
The U.S. Securities and Exchange Commission approved an exchange-traded fund this year that will track the spot prices of ether and bitcoin, which has given the cryptocurrency markets a boost.
More recently, investors’ fears of an impending U.S. recession and growing geopolitical concerns have caused Bitcoin to plunge along with other assets, including international equities, in a widespread selloff. The cryptocurrency has decreased by almost 20% since its peak in March 2024.
According to IG market analyst Tony Sycamore, “it’s a big reminder that Bitcoin and crypto in general are risk assets and sit at the pointy end of the risk spectrum.”
While ether fell to its lowest point since mid-January and was last down 16% at $2,300, bitcoin fell to $53,091, its lowest since late February and last traded for $54,112.
According to Sycamore, to “avoid further capitulation towards $48,000, Bitcoin must maintain its hold at the $54,000/$53,000 area, where it is testing trend channel support.
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