The cryptocurrency market, led by Bitcoin ($BTC), experienced a notable decline in late May, with the price dropping to $106,709 after touching a peak of $111,000, a decrease of about 4%. Here are the key influencing factors:
1. Political statements and their impact on markets
Comments from former US President Donald Trump regarding imposing high tariffs on European imports and electronic devices have raised concerns among investors, which has reflected on the performance of risk assets, including cryptocurrencies.
2. Rise in US Treasury yields
The yield on 10-year bonds reaching 4.79% increased the attractiveness of traditional investments at the expense of digital assets, prompting investors to reduce their positions in the market.
3. Profit-taking from ETF funds
After the strong performance of cryptocurrencies in early May, ETF funds and some institutions took profits, leading to a decline in buying momentum and an increase in selling pressure.
4. Liquidation of leveraged positions
Price volatility has caused the liquidation of many leveraged positions, triggering automatic sell orders and intensifying the decline, especially on major platforms.
5. External security concerns
Despite no confirmed reports of security incidents involving the Binance platform, news of security issues on other platforms has sparked a wave of caution, reflecting on market liquidity.
6. Regulatory ambiguity in major markets
The escalating debate around tightening regulatory oversight in the US and the EU contributed to creating an atmosphere of anticipation and caution, especially among institutional investors.
Conclusion
This corrective movement reflects a complex interaction between political, economic, and market factors. Monitoring these variables remains essential for making informed investment decisions in a highly sensitive market.
Note: This content is for informational purposes only and does not constitute financial advice or investment recommendation. It is always recommended to conduct personal research (DYOR) before making any decisions.