Bitcoin falls below $69,000, speculation on the bubble theory intensifies.
Bitcoin has fallen about 3% to $68,631 from its recent historical high, sparking debates about speculative bubbles. Just a day ago, it hit a peak of nearly $73,798. In recent months, investors' bets on the Fed's interest rate cuts have driven the rebound of global stocks, bonds, and cryptocurrencies. However, recent inflation pressures have led investors to reassess these bets. The market is showing signs of a bubble, triggering debates about a market correction. Bitcoin supporters argue that net inflows into trading funds and a slowdown in Bitcoin supply growth will support Bitcoin prices.
Zhitong App has learned that Bitcoin has fallen from its recent historical high, sparking a heated debate on whether the latest round of bull market in cryptocurrencies proves the existence of a speculative bubble in the global market. As of the time of writing, Bitcoin has dropped by about 3% to $68,631, after hitting a historical peak of nearly $73,798 just a day ago.
So far this year, Bitcoin and the index tracking the top 100 tokens, including Ethereum, have all risen by about 60%.
In the past few months, bets on the Fed rate cut have helped drive strong rebounds in global stocks, bonds, and cryptocurrencies. However, with recent evidence showing persistent inflationary pressures in the US, investors are reassessing these bets.
Michael Hartnett, Chief Investment Strategist at Bank of America, stated that with the record surge in the "Big Seven" tech stocks and historical highs in cryptocurrencies, the market is showing signs of a bubble.
These remarks have sparked a debate on Wall Street about whether many markets are vulnerable to a pullback. Bitcoin supporters argue that approximately $11.6 billion in net inflows into US exchange-traded funds (ETFs) and the imminent slowdown in Bitcoin supply growth will support Bitcoin prices.
A report released on Thursday showed a significant increase in US producer prices, raising concerns that the Fed's efforts to control inflation are far from over.
Tony Sycamore, a market analyst at IG Australia Pty, wrote in a report that Bitcoin "has been affected by the rise in US Treasury yields and the US dollar, which are driven by the hot producer price inflation data."