Bitcoin hits $40,000, the lowest since the introduction of the Bitcoin ETF

Bitcoin hits $40,000, the lowest since the introduction of the Bitcoin ETF

After a brief rebound, the biggest cryptocurrency in the world was dropped 3.98% at $39,938.00, trading at its lowest level since December 4. At $2,328.30, Ether, the second-largest cryptocurrency, was down 6.37%.

Monday was the lowest price of bitcoin in seven weeks, breaking below $40,000 for the first time since an 11-spot exchange-traded fund was introduced on January 11.

After a brief rebound, the biggest cryptocurrency in the world was down 3.98% at $39,938.00, retailing at its lowest level since December 4. At $2,328.30, Ether, the second-largest cryptocurrency, was down 6.37%.

The US Securities and Exchange Commission's (SEC) approval of a Bitcoin ETF, which will allow the cryptocurrency to attract a large number of new investors, has caused a jump in the price of bitcoin. Since August, when a federal judge ordered the SEC to reconsider its decision to deny Grayscale Investments' application for a Bitcoin ETF, the price of bitcoin has increased by around 70%.

Analysts have said that they originally anticipated some of those gains to be pared by Bitcoin.

According to some market observers, cryptocurrencies were finding it difficult to compete with conventional equities after the S&P 500 benchmark index reached a new all-time high on Monday, propelled by semiconductor and other tech sectors.

According to Antony Trenchev, co-founder of cryptocurrency lender Nexo, "it feels like Bitcoin investors are traveling on a descending rollercoaster right now as traditional financial measures enjoy a smooth ride to record highs."

He claimed comparable Bitcoin drops have followed prior key crypto events, including the first public offering of crypto exchange Coinbase and the debut of Bitcoin futures.

Trenchev said that withdrawals from Grayscale Investments' Bitcoin Trust, which became an ETF when the SEC authorized further Bitcoin ETF products earlier this month, exerted additional pressure on Bitcoin.

According to a CoinDesk story on Monday, FTX, which declared bankruptcy in 2022, has sold 22 million shares of the ETF for around $1 billion.

"Spot Bitcoin ETFs ... are in prospect of being inducted into the crypto hall of infamy," stated Trenchev.