5 Reasons Bitcoin Dumped to $75K – And Why More Pain May Follow

Bitcoin traded above $82,000 during the previous business week, but it was violently rejected and dropped by over seven grand in the following days to a monthly low of $75,000 marked during the night.

Here are some of the possible reasons behind this correction.

Trump Media, Cuban Sell Off

CryptoPotato reported yesterday that one of the wallets linked to the Trump-family-operated Trump Media Group had sent over $200 million worth of the cryptocurrency to exchanges, with the likely intention to sell. They did something similar four months ago and are deep in the red on their BTC position, which was accumulated at prices near the all-time high.

More sell-off uncertainty came after billionaire investor Mark Cuban said he had disposed of most of his BTC stash after he lost confidence in its role as a hedge against weakening fiat currencies and geopolitical instability. He believes bitcoin’s behavior during the recent war in Iran questioned one of the core reasons he owned the asset.

Separately, Ali Martinez noted that other BTC investors have been sending units en masse to exchanges. Data he obtained from Santiment reads that roughly $745 million worth of bitcoin was transferred to trading platforms in just five days. Similar developments typically increase the immediate selling pressure since most investors transfer funds to exchanges only to sell.

Warsh and War

Yesterday’s bitcoin decline came just a few hours after Kevin Warsh was sworn in as the next Chairman of the Federal Reserve. Analysts who weighed in on his upcoming four-year role, though, noted that the actual concern for bitcoin and crypto would come from his policy on the Fed’s balance sheet.

He previously said the balance sheet is too large and hinted at quantitative tightening, which has historically harmed risk-on assets like crypto.

Lastly, reports emerged late last night that the US President has doubled down on his plans for a “fresh round” of military strikes against Iran as both sides have failed to reach a permanent deal. Moreover, CBS said the President and some members of the US military and intelligence community had canceled plans for the Memorial Day weekend in anticipation of possible attacks.

The war has previously impacted BTC’s price, and the threat of it resuming is unlikely to cause any positive changes. As such, all the aforementioned reasons could result in even more price troubles for bitcoin, especially if the ceasefire ends and the attacks resume.

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