These days, Bitcoin’s trajectory has been somewhat unpredictable. The price fell sharply after reaching a record high of nearly $74,000 last weeks.
Many analysts predicted a “healthy” retracement before another uptrend and warned that a 20% decline was possible. However, the community is interested in knowing how low the property could go. We decided to inquire with well-known ChatGPT competitor Perplexity about potential future pain for the asset.
Factors affecting Bitcoin
The AI Chatbot cites the following explanation for why Bitcoin is declining: Long-term miners and investors have stressed the importance of boosting Bitcoin. They were expecting the property to return to 2021 with great hope. Additionally, novice investors who bought in for less than $30,000 saw their investment more than double in less than a year.
Furthermore, Perplexity highlights another factor —the upcoming Federal Reserve conference —that is causing market turbulence at the moment, particularly in the volatile world of cryptocurrencies. The Fed’s second FOMC meeting of the year may bring about significant changes to the monetary policy of the central bank, which has historically affected the rate movements of Bitcoin.
Most trade analysts believe that the Fed is unlikely to raise interest rates further, despite rumors, as seen in recent sessions.
The Present Drop in Bitcoin
Bitcoin had a strong start to the year, especially after 11 new Bitcoin ETFs were launched in the US in January. The price of BTC surged and, at one point, increased by more than 60% since the beginning of 2024 as demand for those products increased and flows set new records. This peaked last week when the price of Bitcoin reached $73,800, setting a new record.
But at this point, things began to change, and many experts warned that a decline would inevitably occur before Bitcoin could move any farther. In line with these forecasts, the asset saw a massive decline over the weekend, falling to $65,000 and then falling much higher in the early hours of the following week.
Bitcoin hit a low of just under $61,000 this morning, after falling 20% from its recent top in less than seven days.
