Bitcoin faces stagnancy post-SEC ETF approval, with a 4% weekly drop.
Tether acquires 8,888 BTC, aligning with its diversification strategy.
In a recent turn of events, the price of the largest cryptocurrency Bitcoin has faced a period of stagnancy following the approval of a spot Bitcoin exchange-traded fund (ETF) by the United States Securities and Exchange Commission.
Despite initial excitement surrounding the ETF, the cumulative holdings of all Bitcoin ETFs as of January 18th stand at around $26 billion, with Grayscale holding the lion’s share at 581,274 BTC.
Bitcoin’s price, currently trading at $41,541, has experienced a 4% drop in the past week, contributing to the overall cooling down of the cryptocurrency market, which now stands at a capitalization of $1.64 trillion.
Meanwhile, Tether, a prominent stablecoin issuer, has made headlines by acquiring an additional 8,888 Bitcoins in the last quarter, bringing its total holdings to 66,465 BTC, valued at $2.8 billion. This move aligns with Tether’s announcement in May 2023, outlining its intention to allocate up to 15% of its net realized operating profits towards BTC purchases, aiming to diversify the reserves backing its USDT coin.
Notably, short-term holders of Bitcoin have seen a significant reduction in profits, with a 50% decrease since Bitcoin’s peak at $44,000. Many holders who have possessed Bitcoin for less than one month are exiting the market at a financial loss, raising concerns about potential selling pressure and exit liquidity.
Will BTC Hit $45K Anytime Soon?
The daily chart of bitcoin shows a bearish trend, with the 9-day exponential moving average (EMA) currently positioned below the trading price at $41534. However, the daily relative strength index (RSI) suggests a neutral condition, standing at 43.
BTC Price Chart, Source : TradingView
If the price manages to go below the $40,680 level, then it will likely decline further to test $37,690 support level. On the other hand, if the Bitcoin price manages to go above $43,460 level, then it will likely test the $44,500 resistance level.