Investing.com - Bitcoin prices tumbled on Tuesday as the halving event passed with little price movement, while capital outflows from investment products continued amid uncertainty over higher interest rates for a longer period of time.
Although the launch of a new protocol on the Bitcoin blockchain prompted an increase in on-chain activity, the move provided little support for the token's price. The launch also largely overshadowed the halving event.
Bitcoin fell 0.1% over the past 24 hours to $66,318.60 at 01:26 ET (05:26 GMT).
Bitcoin prices were little changed as ETFs saw continued outflows
Data from digital asset manager CoinShares showed on Monday that Bitcoin investment products, especially exchange-traded funds, saw outflows of about $192 million in the week to date. April 21.
Overall trading volume also fell amid fading enthusiasm for the launch of Bitcoin spot ETFs earlier this year. CoinShares said in a report that U.S. ETFs in particular saw outflows of $244 million over the past week.
Although the launch of spot ETFs pushed Bitcoin prices to record highs in March, the token has largely remained range-bound – between $60,000 and $70,000 – over the past month, amid Appreciation for ETFs is waning.
Cryptocurrency ETFs have seen steady outflows in recent weeks as markets grow more skeptical of an early interest rate cut by the Federal Reserve. Lower interest rates remain the main driver of long-term crypto returns, as the sector benefits from increased speculative activity in a highly liquid environment.
But the prospect of higher interest rates for longer – following Fed tightening signals and tough inflation data – creates a less favorable environment for cryptocurrencies.
Cryptocurrency prices today: Other coins are slightly higher
Other crypto tokens saw some strength on Tuesday. But they also largely remained in narrow ranges amid few positive signals for the sector.
The world's No. 2 token Ethereum fell 1.3% to $3,184.07, while Solana and XRP increased 3.2% and 2.5%, respectively.
But further gains in other coins are limited as crypto traders remain largely biased towards Bitcoin.
Crypto stocks benefit
Despite wide-ranging crypto token prices, crypto stocks saw some gains on Monday, as the impact of the halving event – which halved mining rewards – was largely overshadowed by a spike in Bitcoin transaction fees, reaching record highs.
This spike was driven by the launch of the “Runes” protocol on Bitcoin, which allows users to create tokens on the world's largest blockchain.
Marathon Digital Holdings Inc (NASDAQ:MARA), Coinbase Global Inc (NASDAQ:COIN), Riot Platforms (NASDAQ:RIOT) and MicroStrategy Incorporated (NASDAQ:MSTR) rose between 6% and 13% on Monday.
