Crypto Week Ahead: Bitcoin Slump Expected To Continue Amid Ongoing Market Woes

Over the past seven days, Bitcoin (BTC) price achieved a high of $29,653.10.

Bitcoin (BTC), the oldest and still the most relevant cryptocurrency in the world, endured a tough week and it appears that the ongoing market woes will continue to restrict its rallying chances in the coming days. The overall market fear and greed index leaned towards fear among investors, with a score of 35 out of 100, as per CoinMarketCap. SpaceX’s sudden dumping of BTC holdings and Grayscale's unresolved legal dispute around Bitcoin ETFs continued to haunt the overall market. 

Before we proceed further, readers should note that the overall crypto market and coin prices are extremely volatile in nature. There are no foolproof methods to ascertain how cryptocurrencies are expected to behave in the future. This article is aimed at helping investors stay on top of the current market scenarios and the biggest events that have already taken place as well as some upcoming occurrences that are worth noting. Investors are advised to do their own research before taking any call. 

Crypto Prices Over The Past Week

Last Monday (August 14), the overall crypto market cap stood at $1.17 trillion. BTC price stood at around $29,300, ETH price stood at around $1,840.

A week later, the overall market cap dipped to $1.06 trillion.

DeFi's total volume stands at $1.67 billion, at 7.54 percent of the total market 24-hour volume. In the case of stablecoins, the overall volume stands at $20.56 billion, at 92.77 percent of the total 24-hour market volume. As per CoinMarketCap, the overall market fear and greed index stood at Fear, at 35 points (out of 100).

BTC dominance, at the time of writing, stood at 47.99 percent.

Over the past seven days, Bitcoin achieved a high of $29,653.10 (on August 14) and a low of $25,729.500 (August 18).

Ethereum, on the other hand, saw a high of $1,853.60 (August 14) and a low of $1,604.11 (August 18).

Crypto Events To Note

Elon Musk's SpaceX reportedly sold off all of its Bitcoin holdings last week. These holdings, which were acquired by the company between 2021 and 2022 and were valued at approximately $373 million, have been divested. This decision coincides with a time of market uncertainty in the cryptocurrency sphere, as per reports from various media sources.

The sale of SpaceX's Bitcoin assets occurred in a short span of 30 minutes and resulted in the liquidation of cryptocurrency positions worth around $800 million. While the exact relationship between this sale and the subsequent liquidations remains unclear, the timing has sparked speculations. The report contributed to a downward pressure on the price of Bitcoin, impacting an already ongoing bear market in the cryptocurrency realm. The temporary recovery that briefly pushed the price above $28,000 was swiftly halted due to these liquidation events.

Additionally, despite rumours, there has been no conclusive verdict regarding Grayscale's legal dispute against the Securities and Exchange Commission (SEC) concerning their request to convert a spot Bitcoin Exchange-Traded Fund (ETF). Although anticipation had grown for a resolution today, this possibility was dismissed by James Seyffart, an analyst from Bloomberg Intelligence.

The potential ramifications of the lawsuit, whenever they may be determined, hold the capacity to establish a precedent that will shape the landscape of transactions involving digital assets. Grayscale, a prominent figure in the realm of digital currency asset management, has engaged in a prolonged legal confrontation, contesting the SEC's ruling that impedes the company's bid to transform its Bitcoin holdings into a spot ETF.

Lastly, the beleaguered firm China Evergrande Group has initiated the process of seeking bankruptcy protection in the United States, marking a significant step within a massive global debt restructuring effort. This move comes amidst increasing concerns regarding China's deteriorating real estate turmoil and its potential consequences for the already vulnerable economy.

In an unforeseen development this week, China took the unconventional step of reducing key interest rates in an attempt to revitalise a struggling economy. Furthermore, there are expectations of a forthcoming reduction in prime loan rates on Monday. However, analysts suggest that the measures implemented thus far are insufficient and belated, emphasising that much more potent actions are required to halt the ongoing decline of the economy.
For now, investors should tread with caution as the overall market outlook appears gloomy, especially due to the lack of a crypto-positive event over the past few days. 

What Crypto Traders Are Saying About Current Market Scenario

Mudrex co-founder and CEO Edul Patel told ABP Live, “Bitcoin has been trading around the $26,000 level for the past few days. Over the last week, prices dropped from trading around the $29,000 mark to the $26,000 level. This drop might be because traders are selling the tokens en masse based on several unrelated catalysts like a lack of clarity in the Grayscale v/s US SEC case for a Bitcoin ETF, SpaceX writing down the value of their Bitcoin reserves, and China’s Evergrande group filing for bankruptcy. Ethereum, on the other hand, broke from range-bound trading between $1,800-$1,900 and is trading above the $1,600 level.”

WazirX Vice President Rajagopal Menon offered his take, “Amidst global macro uncertainties, the crypto market faced a tumultuous week, witnessing significant losses. Major cryptocurrencies, including Bitcoin and Ethereum, experienced sharp declines as risk-averse sentiments dominated trading. Regulatory concerns and economic data reflecting caution weighed heavily on investor confidence. The prevailing risk-off sentiment led to a substantial market pullback.”

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Disclaimer: Crypto products and NFTs are unregulated and can be highly risky. There may be no regulatory recourse for any loss from such transactions. Cryptocurrency is not a legal tender and is subject to market risks. Readers are advised to seek expert advice and read offer document(s) along with related important literature on the subject carefully before making any kind of investment whatsoever. Cryptocurrency market predictions are speculative and any investment made shall be at the sole cost and risk of the readers.