Foreign media reports that the cryptocurrency market has seen a four-day correction, with major tokens such as Bitcoin, Ethereum, and XRP generally declining. Previously, news of a near-agreement between the US and Iran briefly spurred a rebound in risk assets, but the market subsequently reversed, indicating that buying interest remains weak.
Legislative progress failed to maintain its upward trend.
The article argues that this round of decline was not driven by a single event, but rather by a combination of factors. Previously, when the US Clarity Act was being pushed forward by the committee, the market also experienced a similar pattern of initial gains followed by a decline, with short-term positive news quickly being reversed.
Negotiators from both parties are pushing the bill forward, but the original plan to sign it before July 4th is now virtually impossible. Reports indicate that meetings will be expedited next week, with the goal of finalizing details before the August recess.
The decline in gold and silver prices has dampened risk appetite.
Besides crypto assets, gold and silver also saw significant declines. Data cited in the report shows that the market capitalization of precious metals evaporated by more than $1.7 trillion in the past 24 hours, with gold falling 4.75% to $4,100 and silver falling 9% to $63.
The article attributes this sell-off partly to the weakening yen. Similar situations have previously triggered adjustments in carry trades and impacted broader risk asset markets, including crypto assets. The simultaneous weakening of gold and silver alongside cryptocurrencies has also reinforced risk aversion in the market.
Mining companies are still releasing selling pressure.
The article also mentioned that the operational pressure on Bitcoin mining companies has not eased. JPMorgan Chase stated that the price of Bitcoin has been below its estimated production costs for five consecutive months, and approximately 20% of miners are operating at a loss.
To maintain operations, listed mining companies sold a total of over 32,000 BTC in the first quarter. The article argues that this continued selling pressure is putting additional strain on the market. In contrast, smaller private mining companies have fewer financing channels, and if the price of Bitcoin continues to fall, they are more likely to sell further.
Strategy concerns have been revived
The report also mentioned that market concerns about Strategy and its STRC preferred stock are increasing. The article stated that if the company needs to sell Bitcoin in the future to cover STRC-related losses, it could further increase market selling pressure.
Additional information:The section about Strategy in the article is based on foreign media's judgment of potential scenarios, and is not a fact that the company has already disclosed; the main theme of the article is that insufficient institutional buying, mining company sell-offs, and declining risk appetite are jointly suppressing the market.
