Bitcoin Tumbles Below $60K, Risking Deeper Pullback as Crypto Markets Endure Worst Month Since FTX Crash (2024)

It might be time to call the cryptocurrency correction a bear market, as bitcoin (BTC) tumbled below $60,000 with what appeared to be a poor debut of spot ETFs in Hong Kong and interest rate fears giving traders plenty of reason to sell on Tuesday.

BTC hit a $59,100 low in the afternoon hours, its weakest price since late February and down over 5% over the past 24 hours. The broad-market CoinDesk 20 Index (CD20) declined even more during the same period, falling 6% as ether (ETH), solana (SOL) nursed 7%-8% losses.

Bitcoin now lower by roughly 20% from its all-time high above $73,000 hit in mid-March.

Traditional markets struggled as well after a spate of U.S. economic reports Tuesday morning had a stagflationary feel, showing slowing growth and speedier price pressures. The Nasdaq shed 2% for the day, while the S&P 500 fell 1.6%.

Recent reports showing stronger U.S. economic data and hotter inflation significantly tapered U.S. Federal Reserve interest rate cut expectations and that's weighing on the digital asset market, Joel Kruger, market strategist at LMAX Group, pointed out in a Tuesday report.

"We continue to see evidence of the Fed needing to be leaning back to a higher for longer policy outlook, despite investor calls for more accommodation," Kruger said. "With the U.S. dollar coming back into favor across the board, we are seeing this filter over into crypto assets as well."

Worst month since FTX

With Tuesday's decline, BTC and the broader crypto market are on track to snap their seven-month winning streak with their worst monthly decline since November 2022, when crypto exchange FTX imploded.

With a few hours left from the last day of the month (UTC time), bitcoin is down over 16% through April, and ether is lower by 18%.. Smaller cryptocurrencies suffered an even deeper correction, with altcoin darlings SOL, dogecoin (DOGE), avalanche (AVAX) lower by 35%-40% this month.

Overall, the total crypto market capitalization shed nearly 18% of its value, recording its biggest decline since June 2022, TradingView data shows.

Bitcoin's decline might not be over

"I’m expecting a sell-off to the mid-to-low $50,000 region [for BTC], which should prove to be a buying opportunity," said John Glover, chief investment officer of crypto lending firm Ledn.

Seasonal effects with lower interest during the summer months also point towards lower prices, K33 Research noted.

"A trader opting for a strategy of buying BTC on the May open and closing the trade on the

September close would’ve seen a cumulative return of -29% in the past five years," K33 analyst Vetle Lunde said. "Whereas a trader buying the October open and selling during the April close would’ve experienced a massive 1,449% return."

The (not so) tepid Hong Kong ETF debut

The first day of Hong Kong-listed spot bitcoin and ether ETFs failed to wow market participants focusing on the products tepid, just over $10 million trading volume.

The debut, however, was more successful than at first impression considering that the Hong Kong ETF market is only a fraction of the U.S. market size, Bloomberg Intelligence senior ETF Eric Balchunas analyst pointed out.

"If you localize numbers, this was big," Balchunas said.

ChinaAMC's bitcoin product alone gathered over $123 million of assets in its first trading session, making it the sixth best ETF launch over the past three years and is already among the top 20% largest ETFs, he cited Bloomberg data.

Balchunas also added that the Hong Kong-listed ETFs arrived at a "good time" and could help offset the outflows from U.S. products that have slowed down recently.