![Why is Bitcoin price down today? Why is Bitcoin price down today?](https://i0.wp.com/images.cointelegraph.com/images/1200_aHR0cHM6Ly9zMy5jb2ludGVsZWdyYXBoLmNvbS91cGxvYWRzLzIwMjItMTEvZDM2MDViNmItMGVmZi00NmY2LWE0NmYtYjE1ZWMzYjNlY2JlLmpwZWc=.jpg?fit=%2C&ssl=1)
The bullish momentum that drove bitcoin (BTC) prices to 2023 highs above $31,500 evaporated on July 6 after investor concerns about a potential rate hike resurfaced.
The contraction in bitcoin’s price briefly sent BTC below $30,000, adding to fresh worries among traders that bitcoin miners sending BTC to exchanges could be a sign of an impending sell-off.
Let’s take a closer look at the factors that affect the price of Bitcoin today.
related: Should You Give Your Kids the “Orange Pill”?The Case for Bitcoin Children’s Books
Will the Fed resume raising interest rates?
Although the Fed paused in raising interest rates on June 14, Fed Chairman Jerome Powell appeared committed to lowering inflation by restarting rate hikes.
Following Powell’s FOMC speech on June 14, markets seemed confident that the Fed would start raising rates again.CME Group’s Fed Watch tool The market believes that such a rate hike will come at the next FOMC meeting on July 26. As of July 6, the probability of a rate hike was 92.4%.
![](https://i0.wp.com/s3.cointelegraph.com/uploads/2023-07/3dbc5b9e-f089-4e1b-9e92-ade1f323a60a.png?w=640&ssl=1)
Cryptocurrency prices remain highly correlated to the Dow and S&P 500 so far, and most major banks still expect the U.S. to experience a severe recession sometime in 2023.
Investor sentiment on current economic conditions remains low, according to US Bank’s analysis of more than 1,000 data points.
![](https://i0.wp.com/s3.cointelegraph.com/uploads/2023-07/cd32db09-67c4-4429-921c-58949dd1cce1.png?w=640&ssl=1)
According to Bank of America analysis,
“Ongoing inflation, rising interest rates and uncertainty about the pace of earnings growth in 2023 remain headwinds for share prices. While the pace of inflation is slowing, the Fed is becoming less hawkish and earnings forecasts have stabilized.”
U.S.-led regulatory pressure on cryptocurrency exchanges continues to weigh on markets
Despite the recent intense institutional interest in Bitcoin, the actions of U.S. regulators are still considered unknown. On July 5, BlackRock CEO Larry Fink stated that Bitcoin is digital gold and briefly introduced the company’s recent Bitcoin ETF application.
While countries like Hong Kong and the United Arab Emirates are embracing bitcoin, the U.S. Securities and Exchange Commission filed civil lawsuits on June 5 and June 6 against Binance and Coinbase, two of the largest centralized exchanges in the cryptocurrency space. This action caused Binance.US’s market share to drop from 22% to below 1%.
While the SEC has previously stated that bitcoin is not a security, some market analysts are weighing whether the current increase in action is a new attempt at “Operation Chokepoint 2.0,” a plan to limit access to all digital currencies.
Coinbase may have a pending lawsuit, but ETFs including BlackRock and Valkyrie have listed Coinbase as their desired monitoring partner. For clarity, Coinbase has filed a complaint with the SEC, and the SEC is expected to respond on July 13.
related: CEX Crypto Volume Hits $2.7T in June Amid SEC Lawsuit, BlackRock Bitcoin ETF Filing
While some commentators are excited about the prospect of a bitcoin ETF, not all analysts see the structure as positive for bitcoin prices, citing concerns of “paper BTC”.
Can Bitcoin Price Reverse?
The short-term uncertainty in the cryptocurrency market does not appear to have changed the long-term outlook for institutional investors. Recently, despite the unfavorable regulatory environment in the United States, large institutions have been promoting the development of Bitcoin financial instruments, which may trigger a bull market.
Bitcoin prices continue to be directly affected by macroeconomic events, and further regulatory actions and interest rate hikes may also continue to have some impact on Bitcoin prices.
In the long run, market participants still expect Bitcoin’s price to recover, especially as more and more financial institutions appear to be embracing Bitcoin.
The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph.com. Every investment and transaction involves risk and you should do your own research before making a decision.
Svlook