The price of bitcoin is declining on Tuesday after failing to sustain levels above $79,000, with this threshold now marking the upper limit of its current range. On Tuesday morning, bitcoin traded at $76,923, down 2.4% over the past day, following a rejection from $79,399 on Monday. Other major cryptocurrencies also experienced significant declines, with ether dropping 3.7% to $2,290, XRP slipping 3.2% to $1.39, solana falling 3.9% to $84.10, and BNB declining 1.8% to $625.
The only exceptions among the top 10 tokens were TRON and DOGE. The rise in Brent crude to above $109 a barrel, driven by the failure of Iran's interim deal to reopen the Strait of Hormuz, contributed to the decline in cryptocurrency prices.
Meanwhile, the MSCI Asia Pacific Index remained relatively stable, supported by the Bank of Japan's decision to maintain its policy unchanged. Two contrasting views are emerging among market analysts regarding the future trajectory of bitcoin. Mike Novogratz of Galaxy Digital believes that the combination of retail demand, institutional capital, and limited supply will drive further upside, citing the accumulation of over 40,000 BTC by whales in the past two weeks. In contrast, Ki Young-Ju of CryptoQuant argues that the recent push above $79,000 was primarily driven by a short squeeze in the derivatives market, leaving the market vulnerable to a reversal once the squeeze exhausts.
The coexistence of these views is possible, as spot demand from retail and institutions can coincide with a rally driven by short covering. The key test will be whether the next attempt to reach $79,000 will attract fresh spot bids or exhaust the available shorts to squeeze. Corporate accumulation of bitcoin continues, with Strategy buying $3.9 billion worth of bitcoin in April, the largest monthly accumulation in a year. Japanese company Metaplanet also announced a $50 million bond issuance to finance new bitcoin purchases, adding to its existing corporate bitcoin treasury.
The upcoming week is expected to be pivotal, with the Federal Reserve's policy decision on Wednesday and the release of megacap tech earnings from major companies, which could potentially push bitcoin past $80,000.