Bitcoin Briefly Slides Below $90K, MicroStrategy Buys More | Global News Avenue

Bitcoin (Bitcoin USDEarlier on Monday, Bitcoin prices briefly fell below $90,000 for the first time since mid-November before recovering slightly after a week of frantic trading. Blame investors’ jitters over recent economic data, which aren’t even positive Spot Bitcoin ETF Fund inflows or MicroStrategy’s latest Bitcoin purchases could shake things up.

Just last Monday, cryptocurrencies Breaking through $100,000 Prices dropped to around $95,000 over the weekend. Since then, economic data hope wanes The Federal Reserve’s interest rate cuts are making Bitcoin investors nervous.

Bitcoin’s Fed Dilemma

Sentiment surrounding the future of Fed interest rate policy has been a key factor in price swings in both directions in the past. risk appetite Assets such as Bitcoin. This is at least partly due to the increased attractiveness of Treasury yields in a high-rate environment. In a lower interest rate environment, investors tend to turn to riskier assets in search of higher returns.

Although the Fed has been expected to slow the pace of rate cuts this year, recent better-than-expected labor market data suggests that the Fed is even less likely to cut interest rates.

Concerns about government sales of Bitcoin

To add insult to injury, there are reports that a federal judge is allowing the U.S. government to sell some of the Bitcoin and other cryptocurrencies seized in law enforcement actions. The late-December ruling attracted public attention last week as investors began to worry that some 69,370 bitcoins worth about $6.5 billion last week may soon be available on the market, sending the price of bitcoin lower.

There can only ever be 21 million Bitcoins Cryptocurrency price levels are affected by sudden changes in demand and supply. In theory, a sudden influx of Bitcoin into the market could temporarily drag its price down. However, some experts say these concerns may be unfounded.

While the founder of Glassnode recently said that the seized currency may be auctioned rather than going to cryptocurrency exchanges, the CEO of analytics firm CryptoQuant said that investors should not panic because the relevant Bitcoin volume may “increase in just a few seconds” absorbed within a week.”

MicroStrategy continues to buy Bitcoin

Despite Bitcoin price volatility, MicroStrategy (Magnetic transmission technology) and its CEO, Michael Saylor, remain undeterred. The company on Monday announced its tenth consecutive week of weekly Bitcoin purchases.

MicroStrategy purchased approximately 2,530 Bitcoins last week for $243 million. The purchase was funded by the sale of more company stock, bringing the total number of Bitcoins on the books to nearly 450,000. At recent prices, the collection is worth nearly $41 billion.

MicroStrategy shares fell nearly 3% in recent trading.

Bitcoin’s slide weighs on broader cryptocurrency market

As has been the case in the past, alternative crypto assets have generally performed worse than Bitcoin over the past week, with Ethereum (Ethereum USD) fell about 18%, while Solana (SOLUSD) dropped by 19%.

Ripple (Ripple USD) was a notable exception, rising about 1%. Ripple CEO Brad Garlinghouse posted a photo of himself, Ripple Chief Legal Officer Stuart Alderoty and US President-elect Donald Trump on X last week, which some believe is problematic for XRP from a regulatory perspective A potentially positive development.

Net inflows into spot Bitcoin ETFs remained positive during the week as the products concluded their trading, after investors withdrew their funds days later first year of trading. Even this is not enough to support Bitcoin prices.