Simply put: Inside and out, various bad news have converged!
Too many external 'money grabbers':
Federal Reserve interest rates are too high (over 5%): Keeping money in banks or buying government bonds can earn considerable interest, which is much more appealing than playing with high-risk assets like Bitcoin. A lot of money has flowed back from the crypto market to traditional financial markets.
Global regulations are tightening: Governments are increasingly monitoring cryptocurrencies, and more rules are being imposed. Institutions and large companies, fearing trouble, either stop playing or reduce their involvement, leading to a withdrawal of funds.
Internal 'fighting' in the crypto space + 'tight money':
New ways to make money: DeFi (Decentralized Finance), NFTs (Digital Collectibles) and these new tracks have emerged, and everyone is investing their money in these areas to 'seize opportunities', taking away the funds that could have been used to buy Bitcoin.
Stablecoin 'faucet' tightened: Stablecoins (like USDT, USDC) are the main 'money' for trading in the crypto market; if their circulation decreases, the entire market lacks the 'ammunition' to buy.
Miners are selling coins: Bitcoin miners may be selling their Bitcoin for cash due to high costs or a bearish market, increasing selling pressure.
Hashrate instability: Fluctuations in Bitcoin network hashrate may reflect miners' lack of confidence or cost pressures, indirectly affecting market sentiment.
Everyone is panicking, selling more as prices fall:
Early profit-takers have run: Those who bought Bitcoin at a low price and made money see the trend is not right and quickly sell to lock in profits.
Stop-loss orders triggered: Prices drop to many people’s set 'automatic sell lines' (stop-loss points), causing a chain reaction where more people sell as prices fall, accelerating the decline.
Technical charts look bad: K-charts and indicators show a downward trend, scaring off potential buyers.
Too many short positions: There are too many people betting on declines (shorting) in the futures market, creating a downward pressure that also contributes to the decline.
Old stories are no longer appealing, new stories are stealing the spotlight:
'Halving bull market' dreams shattered: Many expected Bitcoin to surge after the 'halving' (slowing down new coin production), but it did not rise, greatly reducing the appeal of this old narrative.
New concepts are rising: New stories like RWA (Real World Asset Tokenization) are attracting more attention and funds, while Bitcoin's appeal as the 'big brother' has relatively decreased.
What will the future hold?
Short-term view: If the Federal Reserve cuts interest rates (injecting liquidity) and market liquidity improves, it may stop the decline or even rebound a bit.
Long-term view: If Bitcoin wants to truly rebound, relying on old stories is not enough; it needs a major technological breakthrough or a compelling new narrative.
Most important reminder: The cryptocurrency market is highly volatile! Given the current situation, the uncertainty is very high, so be extremely cautious!
In summary: External money grabbing, internal cash shortage, public panic, and outdated narratives have hit Bitcoin hard; it can't hold up anymore. Thinking about bottom fishing? Definitely think twice!
