The price of bitcoin has declined on Tuesday after failing to sustain its position above $79,000 for the third time in eight sessions, thereby establishing this level as a defining factor in its current range. On Tuesday morning, bitcoin was trading at $76,923, marking a 2.4% decrease over the past 24 hours, following its rise to $79,399 on Monday and subsequent reversal. Other major cryptocurrencies, including ether, XRP, solana, and BNB, have also experienced significant declines, with the exception of TRON and DOGE. This downturn in the cryptocurrency market coincides with a surge in crude oil prices, which have risen by 1% to over $109 per barrel, extending their rally to a seventh consecutive day.
The increase in oil prices is attributed to the failure of Iran's proposal to reopen the Strait of Hormuz, which has led to heightened tensions in the region. Meanwhile, the MSCI Asia Pacific Index has remained relatively stable, with Japanese stocks being supported by the Bank of Japan's decision to maintain its current policy.
The yen has strengthened by 0.3% against the dollar, reaching approximately 159 per dollar. Market analysts are offering divergent views on the current state of the bitcoin market. Mike Novogratz, the founder of Galaxy Digital, believes that the combination of retail demand, institutional capital, and limited supply will drive further growth in the market.
In contrast, Ki Young-Ju, the founder of CryptoQuant, argues that the recent surge in bitcoin's price was primarily driven by a short squeeze in the derivatives market, rather than sustained demand, and that the market is vulnerable to a reversal once this squeeze exhausts. The funding rates for perpetual futures across major exchanges remain negative, indicating that shorts are still paying longs to hold positions, a pattern that has historically preceded both short squeezes and their unwinding. Despite these differing views, corporate accumulation of bitcoin continues to grow, with companies such as Strategy and Metaplanet investing heavily in the cryptocurrency.
The upcoming Federal Reserve policy decision and the release of earnings reports from major tech companies are expected to be significant catalysts for the market in the coming days.