$BTC Last night, Bitcoin experienced a sharp drop, and market sentiment was tense. What exactly caused this wave of decline? Let's break it down one by one, give you an in-depth analysis, and predict the subsequent trend, so that you can better understand how to deal with it now.

Two core reasons for last night's decline

1. Rumors of Google’s quantum computing breakthrough

It is reported that Google has made a major breakthrough in quantum computing. According to this statement, the quantum computer it has developed can use the Shor algorithm to crack the private key system based on elliptic curve encryption in a short time. If this technology is realized, it is theoretically possible to reverse the private key through the wallet address within 10 minutes, thus completely subverting the security foundation of Bitcoin.

Market interpretation:
Although this news has caused panic, a calm analysis shows that the technological breakthrough is still a long way from practical application. Moreover, the Bitcoin community has already made plans. If the threat of quantum computing intensifies, the network protocol can be upgraded to quantum-resistant encryption through soft forks and other methods. Therefore, this is more of an emotional impact than an actual security threat.

2. Microsoft shareholders reject Bitcoin investment proposal

At Microsoft's shareholder meeting, a proposal to invest 1% of the company's total assets in Bitcoin was rejected. This undoubtedly poured cold water on the expectation of institutional support for Bitcoin. Microsoft's board of directors even publicly stated that such an investment was not in line with the company's development strategy.

Market interpretation:
This news did have a certain impact on short-term sentiment, but it affected the sentiment of institutional investors more. Microsoft's refusal to invest does not mean that other institutions will follow suit, and Bitcoin has been endorsed by many large institutions (such as Tesla and MicroStrategy). The impact of this incident is only a short-term fluctuation in the wind direction.

My opinion: Don't panic, grasp the key points

Quantum computing: future impact vs. current reality

If quantum computing can really crack Bitcoin, the impact will far exceed the 1,000-point drop, and may be a systemic collapse of the entire market. However, this assumption is too far-fetched, and at this stage it is more of a panic hype. In the long run, the Bitcoin protocol is resilient and can be upgraded to cope with quantum threats.

Institutional investment: Microsoft is not the only "barometer"

Microsoft's decision does not represent the overall view of the institution. For example, ARK Invest, Blackstone and other institutions have already held a large amount of Bitcoin, and their strategies are obviously more valuable for reference. In addition, the market's expectations of institutions should not be limited to a certain company.

The next key event: CPI data becomes the market focus

The US CPI (Consumer Price Index) data at 21:30 tonight will be the next key point. CPI is directly related to the Fed’s monetary policy expectations. If it is higher than expected, it may lead to a stronger dollar and suppress risk assets; if it is lower than expected, it may be good for Bitcoin and boost its rebound.

Coping strategies:

  1. Short-term players: You can pay attention to the support level in the range of 93,000-92,000, make short-term long orders, set the take-profit target at around 100,000, and the stop loss level is recommended to be below 89,000.

  2. Long-term investors: Stay on the sidelines and wait for the CPI data to clarify the market direction before taking action. Even if there is a short-term downturn, the long-term value logic of Bitcoin remains unchanged.

  3. Risk management: Whether it is short-term or long-term, you must control your position and avoid emotional trading. Especially before the announcement of major events, volatility will be amplified, so be mentally prepared.

Conclusion: Short-term fluctuations do not change the long-term trend

Last night's decline was the result of short-term negative news and emotional catharsis, and has limited impact on long-term trends. Google's quantum computing breakthrough is still a distant threat, and Microsoft's decision is more of an individual case. Tonight's CPI data is the key to determining short-term trends.
The cryptocurrency world is unpredictable, so staying calm and developing a good strategy is the key to success.

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