The recent decline in Bitcoin's price can be attributed to a reassessment of Federal Reserve rate cut expectations by major investment banks, following a robust U.S. jobs report. Goldman Sachs and Bank of America have revised their forecasts, with Goldman now predicting fewer rate cuts in 2025. This shift in monetary policy expectations has contributed to Bitcoin's decline, as the market anticipates potential changes in liquidity and investor sentiment. Additionally, the crypto market is witnessing a significant drop in capital inflows, with a 56% decline over the past month, indicating a cooling off period. Network activity for Bitcoin has also hit a two-month low, raising concerns about decreased investor interest, further pressuring Bitcoin's price.
The 2x Bitcoin Strategy ETF (BITX) experienced a notable decline, dropping 4.87% to $50.06 at 5:20 AM on Monday, January 13.