Despite the stock market recovering somewhat from the recent crash, Bitcoin and other cryptocurrencies have fallen in price today. The top cryptocurrency by market cap fell 3% today, with investors fearing a further drop is on the way. BTC fell below $58,000 on Thursday afternoon, with other cryptocurrencies falling slightly. But what caused the downturn?
Today’s sell-off doesn’t seem to have a real catalyst like the previous two drops in the summer of 2024. In July, a German government sell-off in Bitcoin negatively impacted the asset’s price. Just two weeks ago, a stock market crash in the US also impacted cryptocurrencies. However, stocks have been rallying again, and Germany completed its latest Bitcoin sell-off last month. With no clear reason for Bitcoin’s drop, BTC may only face a temporary drop and correction.
Is Bitcoin Ready for Recovery?
The asset has fallen by just over 5% over the past week, with the last 30 days showing a further decline of almost 10%. However, there is room for recovery as many holders and asset managers have made moves today.
Yesterday, Morgan Stanley unveiled new Bitcoin ETF holdings, demonstrating the firm's strong support for the digital asset. Furthermore, the state of Wisconsin also continued its recent investments in the ETF, with its investment board adding over 447,000 shares to its Spot Bitcoin ETF holdings. Today, Marathon Digital Holdings purchased another $249 million worth of Bitcoin. The miner’s reserves have now reached 25,000 BTC.
Also read: Marathon Digital Buys Another $249 Million in Bitcoin
Despite recent price drops, it is clear that Bitcoin continues to grow in popularity. Cryptocurrency as a whole is a hot topic in economics and at the government level. Since BTC is the largest asset by market cap, it also determines whether other cryptocurrencies perform well. If BTC is successful, all crypto is successful. Since Bitcoin has not performed so well today, other assets such as Ethereum and SOL have also fallen. Fortunately, it is likely that all of these assets will recover to close out the week and be back in the green next week.