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Bitcoin's price has dropped from nearly $107,000 to around $94,550, raising concerns about its ability to maintain momentum. Analysts highlight the $92,000 level as crucial support; a breach could lead to further declines toward $81,000. Despite bearish sentiments, some experts remain optimistic, citing significant institutional inflows and historical patterns suggesting a potential rally in January.
The Ethereum Foundation sold 100 ETH, valued at approximately $336,000, contributing to an 8% drop in ETH's price. This sale aligns with the Foundation's strategy of reinvesting in the blockchain's long-term growth, having previously offloaded 4,566 ETH since January 2024. Analysts suggest ongoing sell-offs and bearish market trends may push ETH below the $3,000 threshold, as recent funding rates and liquidations indicate a shift in investor sentiment.
U.S. spot Bitcoin and Ethereum ETFs experienced significant outflows, marking their second-largest exit day, with over $700 million leaving the market. Bitcoin ETFs saw $582.9 million in outflows, while Ethereum ETFs recorded $159.34 million, following a brief period of inflows. Fidelity's funds were notably impacted, with substantial losses reported across several major ETFs.
Fidelity Digital Assets predicts that 2025 will be a crucial year for Bitcoin (BTC) adoption, driven by increasing interest from nation-states and government treasuries. Following significant developments in 2024, including the approval of US spot BTC ETFs, countries like Brazil, Chile, Canada, and the Czech Republic are considering establishing BTC reserves, inspired by the successes of El Salvador and Bhutan. Analysts warn that nations may face greater risks by not investing in BTC amid economic challenges like inflation and fiscal deficits.
Fidelity's analysis indicates that a potential wave of inflation in 2025 could be beneficial for Bitcoin, depending on the fiscal and monetary responses to stagflation. If authorities opt for increased spending, Bitcoin may thrive, while significant cuts could pose challenges. Historical trends suggest Bitcoin could perform well amid ongoing inflation and economic stimulus.
Bitcoin and Ethereum ETFs experienced significant outflows totaling $742 million on January 8, with Bitcoin ETFs alone accounting for $583 million. Research indicates that a supply shock for Bitcoin is unlikely in 2025, as 70% of its circulating supply is in free float, providing liquidity despite market fluctuations. Additionally, a notable decrease in long-term holder supply suggests potential selling pressure, while ETF trading volume remains a minor player in the overall market dynamics.
Ethereum is currently facing challenges in maintaining its price above $3,300, with a recent market price of $3,303 and a minor recovery of 0.44%. Analysts suggest a potential retest of $2,900 could occur, driven by bearish sentiment in derivatives and significant ETF outflows, while a bullish inverted head-and-shoulder pattern hints at a long-term target of $7,000 if momentum shifts positively.
Fidelity's Bitcoin (FBTC) and Ethereum (FETH) spot ETFs have experienced their largest outflows to date, with FBTC seeing $582.9 million and FETH $147.7 million withdrawn as of the 8th. Despite these significant outflows, Fidelity's ETFs still rank second in cumulative net inflows, trailing only BlackRock.
Bitcoin investors withdrew nearly $570 million from US-listed spot ETFs on January 8, as the cryptocurrency's price dipped below $100,000, marking the second-highest daily outflow since launch. The Fidelity Wise Origin Bitcoin Fund was responsible for 45% of this outflow. Despite the significant liquidations totaling around $521 million in the crypto market, overall sentiment remains in the "Greed" zone, with a score of 69 on the Crypto Fear & Greed Index.
Ethereum has plunged nearly 10% in the last 24 hours, trading below $3,400 and facing significant selling pressure, with bears targeting the $3,095 support level. The recent market downturn has led to a 5.51% drop in Ethereum derivatives open interest and substantial liquidations, particularly in U.S. spot ETFs. A breakdown of the $3,244 support could signal further declines, while a potential bounce back to $3,415 remains possible if bearish exhaustion occurs.
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The information provided herein is generated by experimental artificial intelligence and is for informational purposes only.
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