Three Main Reasons for Bitcoin's Decline: CryptoQuant's Data

Recently, the price of Bitcoin has dipped below 100 thousand dollars, causing concern among investors. To explain this situation, a CryptoQuant analyst identified three main sources. The analysis clearly reveals the challenges underlying market fluctuations.

The first point highlights how liquidity stress in the US affects the markets. The Coinbase Premium Index has consistently remained in negative territory in recent weeks, indicating that Bitcoin is being traded at a lower price on the Coinbase exchange in the US. This situation suggests that American investors are selling more aggressively compared to their Asian and European counterparts. As a result, while Bitcoin shows signs of recovery in Asian markets during the night, it faces swift selling pressure when the US markets open.

The second factor is the selling activity of long-term holders (LTH). CryptoQuant's analysis shows that this situation is not limited to a specific period; Bitcoin held for different timeframes such as 6 months, 18 months, 3 years, and 7 years is being sold at the same time. Data from Fidelity also supports that long-term investors in the US are realizing profits for tax optimization purposes as the year-end approaches.

The third factor is the liquidity squeeze resulting from the potential shutdown of the US government. The temporary halt of federal spending has led to billions of dollars being withdrawn from the market, and with the federal budget surplus, liquidity has further tightened. Additionally, the weakening expectations for interest rate cuts in December have significantly pressured risk appetite in the US. This situation has caused a decline in US stock markets and has resulted in losses of %10–20 in crypto-related stocks, while Bitcoin has exhibited a similar downward movement.

Considering all these factors, there are many developments that Bitcoin investors need to monitor carefully. In particular, market liquidity, selling tendencies of US investors, and long-term investor behavior hold critical importance for future price movements.