Bitcoin dropped to a two-month low on Thursday, fell over 4 per cent to $57,711 amid uncertainty over the U.S. presidential elections and reports of bitcoin supply from a defunct Tokyo-based crypto exchange.
Bitcoin fell to its lowest level since May 2, and has lost more than 6 per cent this week.
The world's largest cryptocurrency has been under pressure in recent months after the first debate between U.S. presidential candidates Joe Biden and Donald Trump raised concerns about Biden being replaced as a candidate.
“BTC crashed to a new three month low of under 58k USD before a mini recovery back to just under 60k USD. While the local low of BTC stands at 56.7k USD, anything lower would take us to a 5 month low in BTC prices. If not recovered again, 60k USD may now become a resistance,” said CoinSwitch Markets Desk.
Bitcoin experienced a strong start to the year following the launch of exchange-traded funds in the U.S., reaching a record high of $73,803.25 in mid-March as investors flocked to it. However, the rally has since fizzled, with Bitcoin losing over 21% from its peak.
Analysts attribute this decline to a politically charged environment, with ongoing elections in France and Britain prompting some risk reduction, along with shifting dynamics in the U.S. election campaign.
Additionally, reports that Mt. Gox, once the world's leading cryptocurrency exchange before its collapse in 2014, is repaying its creditors, may be contributing to Bitcoin's decline if those creditors are selling off their tokens.
However, Sycamore noted that although this marked a period of consolidation for the cryptocurrency following substantial gains earlier this year, there was potential for it to retest the March highs and potentially rise towards $80,000.
“On the other hand, asset management firm Bitwise has amended its S-1 registration with the US SEC expected to give the final approvals on the ETH ETF as early as July. However this news could not stop ETH to bleed as it fell by more than 3% yesterday,” Coinswitch further added.
Meanwhile, Ether, another significant cryptocurrency, was trading slightly over 1 per cent lower at $3,213.0, down more than 22 per cent from its peak in mid-March.
Ether's price declined by over 5.4 per cent, falling below $3,200. Concurrently, other prominent tokens like Binance's BNB, Solana, and Dogecoin also experienced decreases of 6.1 per cent, 8.8 per cent, and 7.2 per cent, respectively.
Bitcoin has experienced a notable decline of 18.31 per cent over the past 30 days. This downturn follows its peak above $73,700 in March, primarily driven by regulatory approvals and the launch of spot Bitcoin exchange-traded funds.
