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Bitcoin’s recent price drop has left traders perplexed, but analysts argue that this isn’t just another market fluctuation. After reaching an all-time high of $109K in January, Bitcoin appeared unstoppable. However, February has brought a sharp downturn, with BTC sliding 1.11% in the past 24 hours to $96,148. The big question remains: is this a brief correction, or are deeper market forces at play?
Why Is Bitcoin Falling? Key Factors Behind the Drop
A recent analysis by Altcoin Daily highlights several contributing factors behind Bitcoin’s decline:
- Trump’s Tariff War: Escalating trade tensions with China and Canada led to a 9% BTC drop in early February.
- Bitcoin Reserve Uncertainty: While the Bitcoin Reserve fueled a rally in January, the lack of updates has spooked investors.
- Regulatory Developments: Despite pro-crypto initiatives from the U.S. Senate Banking Subcommittee, Bitcoin hasn’t gained the expected momentum.
Market analysts point out that Bitcoin’s current phase resembles past cycles, where BTC surges ahead of major geopolitical events—such as the 2024 U.S. elections—before stabilizing.
Bitcoin’s Halving Cycle: Where’s the Expected Pump?
Historically, Bitcoin surges after halvings, but this time, consolidation is taking longer. One key factor is regulatory uncertainty. Former U.S. Representative Patrick McHenry emphasized that while crypto-friendly legislation is in progress, significant changes could take 18-20 months. This uncertainty has kept many institutional investors cautious.
Additionally, post-halving consolidation typically lasts 3-4 months before a significant move. If history repeats itself, Bitcoin’s next major rally may still be on the horizon.
Politics and Bitcoin’s Future
Despite Trump’s recent executive orders in favor of crypto, Bitcoin has yet to react strongly. Analysts believe the real impact will be seen once key regulatory positions are filled and crypto-friendly laws take effect. Until then, Bitcoin may remain range-bound.
While meme coins briefly returned to the spotlight—fueled by speculation over a Kanye West-backed coin—the sector has lost over $44 billion in just three weeks. The 2025 meme coin cycle has been marked by short-lived pumps followed by sharp crashes, with Trump Coin plummeting 80% in just 15 days. Analysts predict that meme coins may struggle to regain traction this year.
Also Read: SEC Moves Closer to Approving Litecoin ETF and In-Kind Bitcoin ETF Redemptions
As Bitcoin navigates these uncertain times, traders remain on edge, waiting for the next big move.
Disclaimer: The information in this article is for general purposes only and does not constitute financial advice. The author’s views are personal and may not reflect the views of Chain Affairs. Before making any investment decisions, you should always conduct your own research. Chain Affairs is not responsible for any financial losses.
I’m your translator between the financial Old World and the new frontier of crypto. After a career demystifying economics and markets, I enjoy elucidating crypto – from investment risks to earth-shaking potential. Let’s explore!
