peekpublishersIn a recent analysis by All Star Charts, it was revealed that the price of Bitcoin tends to decline shortly after the cryptocurrency makes forays into traditional finance. The launch of Bitcoin futures, options, and futures ETF all marked short-term tops in the price of Bitcoin. Since the launch of spot ETFs last week, Bitcoin has declined by about 9%.
This pattern has been seen in multiple instances. For example, when the CME launched Bitcoin futures in December 2017, it represented a temporary top for the cryptocurrency, followed by a price crash of 81% over the next year. Similarly, the launch of Bitcoin options contracts by the CME in January 2020 was followed by a decline of about 53% in the price of Bitcoin over the next two months. The IPO of Coinbase on April 2021 also saw a decline of 55% in Bitcoin’s price over two months.
Most recently, the launch of a Bitcoin futures ETF by ProShares in October 2021 marked the top in Bitcoin’s price, followed by a one-year bear market and a decline of up to 78%. With the launch of spot Bitcoin ETFs last week, the question remains whether Bitcoin will follow this historical pattern and experience a sell-off once again.
Since the launch of spot Bitcoin ETFs, the cryptocurrency has already declined by about 9%, indicating a potential continuation of this trend. Many investors are watching to see if Bitcoin will repeat its historical performance and enter another bear market following its entry into traditional finance.
