Bitcoin price dropped by nearly 7% just 2 days after the spot ETF approvals. Cointelegraph investigates why BTC price is correcting.
Bitcoin (BTC) price dropped by 6.8% between Jan. 11 and Jan. 12, confirming bears' theory of a sell-the-news style event occurring after the approval of a spot BTC exchange-traded fund. The much-anticipated event ensued after a 75% rally in the 90 days leading to the initial trading on Jan. 11. This partially explains the lack of excitement and the subsequent price correction down to $43,180.
Traders are now questioning whether investors are becoming bearish after multiple failed attempts to break above $47,000 in the last week. On one side, there is some rationale behind the fear, meaning market makers and whales that tried to front-run the spot ETF issuers by buying ahead of the launch might be forced to sell at a loss – if this hypothesis is valid. Furthermore, Bitcoin miners might feel pressured to sell some of their holdings given that the halving is less than 100 days away.
Regardless of how profitable a Bitcoin mining operation is, a 50% cut in the block subsidy will significantly affect margins. According to Bitcoin News, miners' outflow hit a six-year high as $1 billion worth of BTC was sent to exchanges.
