Bitcoin Plummets Below $39K, Erasing Gains Made In Two Months Following US Spot ETF Launch

The price of Bitcoin (CRYPTO: BTC) has fallen below $39,000, losing nearly all the gains made in the last two months following the launch of spot exchange-traded funds (ETFs) in the U.S.

What Happened: Bitcoin’s value dropped by almost 5% in the last 24 hours, hitting its lowest level in two months, reported CoinDesk on Wednesday. The CoinDesk 20, which tracks the top tokens by market cap, also fell by 7%.

The cryptocurrency’s value plummeted to $38,700 before making a slight recovery. This comes after Bitcoin reached a two-year high of over $49,000 when the spot Bitcoin ETFs began trading in the U.S. on Jan. 11.

See Also: Bitcoin, Ethereum, Dogecoin Drop As Google Search Interest In Spot ETFs Plunges: Analyst Foresees King Crypto Below $40K Before April Halving

The recent sell-off is attributed to the FTX bankruptcy estate, which has sold around 22 million shares of Grayscale’s GBTC in the past few weeks. This has led to concerns that the ETF approval would trigger a “sell-the-news” event, a term used to describe a drop in asset prices following a bullish event.

Analysts at Japan-based crypto exchange bitBank believe that the ETF approval is “likely to be a short- to mid-term top for the price.”

Why It Matters: The recent dip in Bitcoin’s price follows a downward trend over the past week, during which the price decreased by 5%. The trading volume for the coin also fell by 21% over the past week, moving in the same direction as the overall circulating supply of the coin, which decreased by 0.27%.

Meanwhile, Peter Schiff has criticized the decline in Bitcoin ETFs, noting that all spot Bitcoin ETFs have entered a bear market. Schiff suggested that the Vaneck Bitcoin Trust, currently using the symbol $HODL, might consider changing to GTFO.

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Photo: Roy Buri from Pixabay.