Bitcoin’s price dipped below the $61,000 threshold following the launch of the first spot Bitcoin exchange-traded funds (ETFs) in Hong Kong. The decline raises concerns about whether Bitcoin will drop below $60,000 in the coming days.
On April 30, Bitcoin reached a weekly low of $60,543, just a day after the introduction of the initial batch of spot Bitcoin ETFs in Hong Kong. According to CoinMarketCap, the world’s first cryptocurrency has fallen by 7.3% on a weekly basis and 13% on a monthly chart.
The Hong Kong-based ETFs only generated $12.4 million in trading volume on their first day, a significantly lower figure compared to the $4.6 billion trading volume of the U.S. spot Bitcoin ETFs on their first day. Nevertheless, this is a substantial amount considering the size of the Hong Kong market, equivalent to $1.6 billion in the United States, as noted by senior Bloomberg ETF analyst Eric Balchunas.
Approximately 14% of the daily trading volume of $12.4 million was attributed to spot Ether ETFs in Hong Kong, with the remaining 86% flowing into Bitcoin-based ETFs.
The decline in Bitcoin’s price following the launch of the Hong Kong ETFs is a typical “sell-the-news” event, according to Mehdi Lebbar, co-founder of institutional-grade risk assessment platform Exponential.fi.
In the United States, weekly net flows for Bitcoin ETFs remain negative, with over $257 million in negative outflows this week. This is a decrease from the previous week’s negative outflows of over $396 million, according to Dune data.
In 2024, U.S.-based ETFs played a significant role in Bitcoin’s price appreciation, accounting for about 75% of new investments when it surpassed the $50,000 mark, according to CryptoQuant research.
Ben Caselin, CMO of VALR exchange, suggests that Bitcoin’s downward trend in recent weeks could potentially push it below the $60,000 mark. However, this could present a buying opportunity for long-term holders, similar to corrections seen after previous post-halving rallies, according to Lebbar.
If Bitcoin’s price were to fall below $60,000, over $306 million worth of cumulative leveraged long positions would be liquidated across all exchanges, according to Coinglass.
Traders should closely monitor the key support levels at $60,000 and $51,000, as these will be crucial in determining Bitcoin’s future movements, as highlighted by Matt Bell, CEO of open-source software firm Turbofish.
It is important to note that this article does not provide investment advice or recommendations. Readers should conduct their own research and exercise caution when making investment decisions.