Bitcoin slumped 6% today, dropping below $69,000 and pushing billions’ worth of recent spot exchange-traded fund purchases underwater before the cryptocurrency rebounded back above $70,000.
Data from investment management company Farside Investors shows that since the start of the week, investors have put over $2.2 billion into Bitcoin spot ETF shares.
Those shares were all purchased when Bitcoin traded between $69,205 and $73,737. Bitcoin’s sudden drop to $68,861 plunged the purchases into the red.
It’s the biggest price drop Bitcoin has experienced since March 5, when it briefly fell to $60,861 from $68,000 before recovering.
Bitcoin’s quick bounce back today likely indicates the ongoing demand amid an ETF frenzy that saw investors push over $1 billion into ETF shares in a single day on Tuesday.
Just hours before today’s drop, Bitcoin registered an all-time high of $73,737.
Other major cryptocurrencies also took a hit. Ethereum’s Ether token fell more than 5% despite the excitement over the network’s Dencun upgrade. Dencun went live yesterday, and has helped lower transaction fees on Ethereum layer 2 networks.
Like Bitcoin, Ethereum has also staged somewhat of a recovery, but the token is still down 1.3% on the day.
A wave of spot ETF approvals in January have in part driven Bitcoin’s price beyond its 2021 all-time high of around $69,000.
But that’s not the only reason. Bitcoin is fast approaching its halving — an event that occurs roughly every four years where the rewards distributed to Bitcoin miners are halved.
Currently, the halving is estimated to take place on April 19.
Tim Craig is DL News’ Edinburgh-based DeFi Correspondent. Reach out with tips at tim@dlnews.com.
