Following a recent email announcement on Wednesday, investment bank Standard Chartered stated that Bitcoin’s (BTC) fall below the $60K technical level indicates that there may be further decline to the $50K–$52K region.
The bank stated that a mix of macro effects and peculiarities unique to cryptocurrencies appears to be the cause of the decline. At the time of publication, Bitcoin’s price was 6% lower, at roughly $57,200.
The U.S. spot bitcoin exchange-traded funds (ETFs) have seen withdrawals for the past five days running, according to the bank, and the current price of BTC is less than the average ETF purchase price of roughly $58K.
Analyst Geoff Kendrick noted, “This means that more than half of the spot ETF positions are under water and so the risk of liquidation of some of them must be considered as well.”
The bank observes that the headlines surrounding the debut of the spot ETF in Hong Kong were likewise unsatisfactory, with the $11 million turnover volume garnering more attention than the new ETFs’ relatively strong net asset positions.
According to the bank, risk assets that depend on liquidity, like cryptocurrencies, are also seeing more and more macro challenges. It stated that since mid-April, the United States’ broader liquidity measures had drastically deteriorated.
If bitcoin hits the $50K–$52K mark or the U.S. CPI, which measures inflation, is “friendly” on the 15th, the bank suggests purchasing.