3 reasons why Crypto plummeted

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Good Morning,

Yesterday Bitcoin registered biggest single-day loss since FTX's Collapse (-8%).

Today on Money Printer Go Brrr I’ll give you 3 possible reasons:

1. There's uncertainty surrounding the Federal Reserve policy meeting.

2. Increasing ETFs Bitcoin Outflow;

3. A Normal Bitcoin Correction Following 6 Consecutive Green Months

1. There's uncertainty surrounding the Federal Reserve policy meeting

As you likely know, a group of individuals controls the dollar's monetary policy.

These individuals are scheduled to meet today at 2 pm EST to decide on the following:

• Increase the benchmark interest rate;

• Leave it unchanged;

• Or decrease it.

1. If the benchmark interest rate is increased

→ The availability of credit will become more restrictive;

→ This will, in turn, reduce the amount of money in circulation;

→ With less money circulating, investments in assets will decrease;

→ If less money is put into investments, the worth of those financial assets will go down.

2. If the benchmark interest rate remains unchanged

→ This sends a neutral to positive signal, instilling market confidence in a possible decrease in the future.

3. If the benchmark interest rate is decreased

→ This is viewed as a positive sign.

→ Credit will become more affordable, promoting easier accessibility.

→ More money inflow in the economy (Inflation).

→ The value of assets will increase.

The ambiguity surrounding these three potential outcomes has brought a halt to the price increase of Bitcoin.

However, it's important to note that this is merely my speculation.

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2. Increasing ETFs Bitcoin Outflow;

An ETF is a new channel that simplifies the process of purchasing Bitcoin.

The procedure of people buying ETFs, which in turn buy Bitcoin, is known as Bitcoin ETF Flow.

Consequently, when people buy ETFs, these funds purchase Bitcoin, contributing to a price surge, or 'pump'.

Similarly, if people sell their ETFs, the funds will sell Bitcoin, leading to a decrease in price, or 'dump'.

Currently, there is an increase in Bitcoin ETF outflows (smart money is selling their ETFs):

• Yesterday, The Grayscale Bitcoin Trust (GBTC) has seen its largest day of outflows on record;
  

• On March 19, the 10 funds lost a total of $326 million.
  

• This means that for two days in a row, these funds have lost more money than they've gained.

This could be another reason for the dropping prices of Bitcoin and Crypto.

Read More

3. A Normal Bitcoin Correction Following 6 Consecutive Green Months

After 6 months of continuous growth, a correction is naturally expected.

This could be the actual reason behind the current fall of Bitcoin and the crypto market.

This growth cannot be sustained indefinitely.

The ongoing correction is beneficial for maintaining this bull run.

There will be a phase of price stabilization, after which the growth is likely to resume.

Without this correction:

→ The growth could turn parabolic and become unsustainable;

→ The bull market could end much sooner.

There's no need to be scared, this correction is healthy for the future growth of the market.

Based on previous bull markets, we can anticipate a correction of 30-40%.

So, we should not be surprised to see Bitcoin at 50-55k.

Meme Of the Day

DISCLAIMER: None of this is financial advice. This newsletter is strictly educational and is not investment advice or a solicitation to buy or sell any assets or to make any financial decisions. Please be careful and do your own research.