Bitcoin slumped below $29,000 for the first time since late June as excitement over ETFs and a more positive regulatory outlook waned.
The drop took place amid the general sell-off in the crypto market, with most major coins suffering losses in the past 24 hours.
According to Spencer Hallarn, a derivatives specialist at crypto investment firm GSR, Bitcoin's recent rise has been driven by the prospect of spot ETFs in the US that will allow investors to buy and sell real coins instead of futures contracts.
However, the market expects more clarity on the possibility of such products being approved by the Securities and Exchange Commission (SEC).
Market Expects Further Developments on Spot Bitcoin ETFs According to Hallarn
“Bitcoin has been consolidating around $30,000 for over a month as the market awaits increasing information on the likelihood of numerous filings,” Hallarn said.
However, some of the attention has shifted to altcoins that have outperformed Bitcoin in recent weeks. XRP, the fourth-largest coin by market capitalization, was on the rise after a federal judge ruled that the coin was not a security when it went public on exchanges.
In his statement, Hallarn said that with the increase in interest in altcoins after the XRP decision, the momentum in the main coins such as Bitcoin and Ethereum decreased, and therefore, with the decrease in the flow of capital to these coins, there was a price drop.
*Not investment advice.