Bitcoin (BTC) fell roughly 7% to $29,309 on June 1, erasing more than half of its relief rally over the previous three days. On Wednesday, most alternative cryptocurrencies (altcoins) fell in tandem with BTC, down between 7% and 17%. Solana’s SOL token and Cardano dropped 12%, and Near protocol and Avalanche were 10%.
Nucypher (NU) soared approximately 150 percent from $0.169 lows to $0.392 highs on June 1. The Nucypher Network has merged with the KEEP Network to form the Threshold Network. On the news, the KEEP network (KEEP) was up 17%. The DAO’s proposal to extend the deadline till June 1 was also revealed by NU. The staking bonus was increased to 3%.
Stocks were also lower on Wednesday as May was a tough month for both stocks and cryptos. It appears that macroeconomic uncertainty has kept some buyers on the sidelines, which has benefited gold and other commodities so far this year.
According to CoinGlass, there have been nearly $593 million in liquidations across the crypto market within the last 24 hours. During the final week of May, bitcoin and stocks experienced a brief relief bounce, which paused the broader downtrend in prices.
Bitcoin trades at $29,707 at the time of publication.
What Led to the Selloff and What Analysts Say
Bitcoin miners are selling their mined tokens as the price of bitcoin continues to fall, creating extra selling pressure. Compass Mining, a bitcoin mining services provider, reported in a research note citing data from CoinMetrics that miner flows to exchanges have reached their highest point since January.
“Miners may start selling hodled Bitcoin on the open market,” Compass stated. “At the absolute least, they are suffering as a result of the most recent huge price drop.” When you combine this with a downward difficulty adjustment, it appears that miners are reaching a point of diminishing returns. “
In a May 30 statement, Cathedra Bitcoin said it sold 235 bitcoins over the month to increase liquidity and “isolate” itself from additional price drops. Due to storms damaging its North Dakota facility, the firm had a difficult April, running at 45 percent of the planned hashrate for the whole month.
If Bitcoin follows the historical trends shown following previous halving cycles, a bottom might form between $14,000 and $21,000 in the next six months, according to CryptoQuant contributor Venturefounder. Following that, Bitcoin may trade in the $28,000 to $40,000 area for the majority of the coming year, peaking at roughly $40,000 around the halving.
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