Here’s Why the Crypto Market Is Down Today, Short-Term Bitcoin ETF Impact Largely Over

The cryptocurrency market had a major pullback following the listing of spot Bitcoin ETFs, with the market capitalization falling to $1.66 trillion from $1.82 trillion. Altcoins like Ethereum rebounded as Bitcoin’s dominance fell below 50%.
Bitcoin price has traded sideways near $42,500 throughout the week and traders try to accumulate below $40,000, but analysts anticipate the days of the short-term impact of Bitcoin ETF approval are mostly passed.
Why the Crypto Market is Down Today
Volatility, earnings season, and macroeconomic variables all harmed cryptocurrency trading volumes. The strong US currency is putting downward pressure on Bitcoin prices. The US dollar index (DXY) has risen back above 103.50 from 101 in early January.
However, Coinglass statistics and recent macroeconomic data show that Bitcoin selling pressure is gradually diminishing. Over the previous 24 hours, the crypto market has seen over $100 million in total liquidation, with 75% longs and 25% shorts liquidated. Bitcoin’s liquidation totaled $22 million, whereas Ethereum’s was $20 million. However, the tendency is changing, with short liquidation increasing in the recent 12 hours.
BTC’s volatility level has reached a new low in the last month, with both primary terms RV and IV exhibiting considerable decreases and short-term IV falling to less than 45%.
According to futures and options data, the spot Bitcoin ETF’s short-term influence has faded significantly. The financing rate is attractive to traders, and buying will begin soon. BTC futures and options open interest (OI) have both risen in the last four hours. BTC OI on exchanges such as CME, Binance, and Coinbase has recovered, with a 0.35% increase to $18.31 billion in total BTC futures open interest.
In contrast, Ethereum open interest (OI) declined more than 2% in the last 24 hours, totaling $8.85 billion. However, Solana and XRP OI are climbing again, and prices may recover soon.
Michael van de Poppe, a top analyst and trader, stated, “People are bearish on Bitcoin and have a negative outlook.” Do not be like that. “Buy the dip and hold.”
BTC is presently trading at $42,875. The current 24-hour low and high are $42,189 and $42,880, respectively. Trading volume remained low ahead of Friday’s expiration. Bitcoin’s upward momentum will cause a drop across altcoins, with the first signs of Ethereum open interest declining.

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Written by Zameer Attar

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