In the previous Bitcoin weekly update, some analysts were hoping that Bitcoin’s price will pump after consolidating between $24,000-$25,000 levels. Some analysts even shared the long-term perspective of Bitcoin where they were expecting a massive price increase. But Bitcoin’s price dropped instead.
The following Bitcoin weekly news may highlight the reasons why Bitcoin’s price dropped and how it may perform over the coming days.
Bitcoin Weekly Update by KALEO
It’s better to start with a positive update because there’s fear in the market and many investors are afraid that Bitcoin’s price may drop even further.
Kaleo is an experienced trader who regularly shares his analysis about Bitcoin and other financial assets. He shared Bitcoin’s weekly chart mentioning that the $30,000 level is acting as a magnet which means that the price of Bitcoin will eventually reach that level.
On the chart, he has highlighted the breakout of Bitcoin’s price. He has also highlighted an expanding pattern with dotted lines showing that Bitcoin’s price may continue moving in this range for a few more days.
But on the top of the chart, he has added a magnet close to the $30k level which means that he’s confident that Bitcoin may touch that price level over the coming days.
Bitcoin Miners are Bullish About Bitcoin
Bitcoin’s mining difficulty has reached an all-time high of 43.05 Trillion after an increase of 9.95%. For those who don’t know, Bitcoin miners need to provide the computational power to solve the puzzles created by the network. An increase in mining difficulty means that the miners need to add more computational power to solve the puzzles.
And despite this recent spike, the miners are still deploying capital to expand the operations. It means that the miners are still bullish about Bitcoin’s price because they can only benefit from this investment if the price of their mined assets increases.
A spike in mining difficulty doesn’t directly influence the price of Bitcoin. But the miners need to use more energy resources to mine one Bitcoin. And their commitment to increasing their resources shows that they’re expecting Bitcon’s price will rise in the future.
IMF Calls for More Crypto Regulations
IMF previously warned El Salvador about financial instability because El Salvador is the first country that accepted Bitcoin as a legal tender. This week, IMF Managing Director Kristalina Georgieva raised concerns about crypto regulations during G20 meetings with finance ministers.
She co-chaired a meeting with Nirmala Sitharaman, the Indian Finance Minister. Most finance ministers agreed that crypto regulation must be made a priority to ensure financial stability. Georgieva further explained that IMF is working with the Bank of International Settlements and Financial Stability Board to regularize cryptos.
They’re mainly focused on highlighting the importance of Central bank digital currencies that are backed by the state and stablecoins. Most executive board directors agreed upon implementing targeted restrictions instead of executing strict bans.
The board also advised that the countries should avoid granting crypto assets the status of legal tender as it may affect the country’s monetary sovereignty and stability. It’s again a warning for El Salvador because the country has given Bitcoin the status of legal tender since September 2021.
Total Value Locked in Defi Falls Below $50 Billion Mark
This can be one of the reasons why Bitcoin’s price dropped along with other cryptocurrencies over the past few days. For those who don’t understand, Defi investors are required to lock their crypto tokens in different liquidity pools to earn the rewards. These investments are usually supposed to be long-term.
Investors pull out their investments when they expect a short-term price drop. The purpose of withdrawing the funds is to secure the profits they’ve earned over a certain period of time. According to a recent update, Defi investors have withdrawn a huge amount of funds due to which the Defi market’s value dropped below $50 billion.
Ethereum is the leading platform in this category which has around 59% of the total value locked. Tron, Binance Smart Chain, Arbitrum, and Polygon are other leading platforms in this industry.
Arbitrum was the only platform among the top ten blockchains in terms of TVL size that saw an increase of 9.39% last week while all other leading networks experienced a steep decline.
The Number of Bitcoin Whales Drops Significantly.
Bitcoin Whales are the investors holding more than 1,000 Bitcoins in their wallets. And according to a recent update, the number of Bitcoin whales has dropped to 2,027 while this number was around 2,500 in February 2021. The situation is pretty much similar to August 2019 because the number of Bitcoin Whales dropped to 2023 at that time.
In the first quarter of 2022, the number of Bitcoin whales jumped from 2,117 to 2,286 within a month. However, the number of Mega whales is still close to the historical high of November 2022. Mega Whales are the investors who hold more than 10,000 Bitcoins in their wallets.
The important part is that the number of small investors (who hold more than one Bitcoin) is consistently increasing. The stats show that more than 982,000 crypto wallets are now holding more than one Bitcoin. It shows that more investors are now showing more interest in Bitcoin even after seeing extreme volatility in Bitcoin’s price.
Bitcoin weekly news shows that analysts and Bitcoin miners are still bullish about Bitcoin. IMF’s call for crypto regulation and a significant drop in the total value locked in Defi space may be the reason why Bitcoin’s price dropped last week. We invite you to share your thoughts about whether you’re bullish about Bitcoin or not.