The Fed's Sentiment Encourages Bitcoin ETF Outflows Worth IDR 9.8 Trillion

Previously, Bitcoin (BTC) had faced significant selling pressure over the past week, causing a decline of 4.5% in the last seven days, reaching a monthly low of USD 65,000 or the equivalent of IDR 1.06 billion (assuming an exchange rate of IDR 16,421 per US dollar) .

Financial Expert Ajaib Crypto Panji Yudha explained that the decline was caused by an increase in BTC sales from BTC mining companies and the impact of the United States (US) Federal Reserve's move to maintain high interest rates.

Last week, the Fed announced it would only cut interest rates once in 2024, changing from its previous target of three cuts. The US central bank also kept interest rates stable at 5.25%-5.50% at its June meeting.

“Miners' recent decision to divest their holdings is related to the decline in revenue following the halving event. “With decreasing transaction fees and remaining high network hashrate, miner income has continued to decline over the last few months,” said Panji in a market analysis received by Todaysgist.com, Tuesday (18/6/2024).

Additionally, according to Coinglass data, hawkish comments from the Fed last week had an adverse impact on trading of spot Bitcoin ETF products in the US which saw outflows of USD 580 million in the June 10 – 14 trading period.

Panji added, based on historical patterns, continued low revenues and high hashrate could indicate a potential market bottom.

“Ultimately, this shows the Bitcoin market may be reaching stability or preparing to regain its bullish momentum,” explained Panji.