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Markets continue to slide despite Bitcoin ETF inflows

The story of Bitcoin's price action this year so far can be told easily.
The story of Bitcoin's price action this year so far can be told easily.

Each day, Coinrule will run through the state of the digital assets market for Blockbeat, your home for news, analysis, opinion and commentary on blockchain and digital assets.

The story of Bitcoin’s price action this year so far can be told easily. At first, we saw a near-parabolic run-up following the ETF approval. Then, Bitcoin’s price ranged between $60,000 – $70,000 for a few months. Momentum was building for a breakout, either downwards or upwards. The closer the traditionally slower summer months came, the less likely was another move upwards. We have now seen a decisive break below the $60,000 price and any bullish momentum so far is gone.

Ethereum has seen a speedrun of this price action. It quickly saw significant gains on its own unexpected ETF news in May. These gains have now been fully retraced. On most other Altcoins, the less said the better. Many are down significantly. Most have not seen anything resembling what crypto traders would call an ‘altcoin cycle’ in this bull market so far. This is among the biggest disappointments for many traders who heavily bet that altcoins will follow a Bitcoin and Ethereum rally.

The story of Bitcoin's price action this year so far can be told easily.
The story of Bitcoin's price action this year so far can be told easily.

The only strong mania in this cycle so far were Memecoins. Dogwifhat (WIF), Bonk (BONK) and others saw significant growth. But that growth also peaked in March. WIF is down 65% from its all-time high, BONK is down 52%. In the current market environment no winners are left.

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The key question now is if this is only a dip in a bull market, or the end of it. Summer slowdowns are a long tradition in crypto markets, but other good news is on the horizon. The Ethereum ETF will launch imminently. Despite a host of bad news, Bitcoin’s ETF saw $140 million of inflows on Friday July 5th, the latest day for which data was available.

What is hampering short-term price action remains the combination of sell pressure stemming from the German government’s Bitcoin sales over the past week as well as the imminent Mt. Gox coin releases. Traders anticipate and position accordingly. On the flipside however, for anyone who missed the rally earlier in the year, prices and valuations are starting to look attractive. The underlying fundamentals never went away either. Hope exists in the market that maybe autumn will bring some joy back and the bull continues after a short summer dip.