"It doesn't end at $75,000"...Bitcoin's 5 major bearish factors, warning of further decline

▲ Bitcoin (BTC), cryptocurrency decline, bear market/AI-generated image

Bitcoin (BTC) traded above $82,000 during the previous business week but suffered a strong rejection, plummeting over $7,000 in a few days to a monthly low of $75,000 in overnight trading. The simultaneous overlap of selling pressure, macroeconomic variables, and geopolitical tensions also raised the possibility of further declines.

CryptoPotato, on May 23 (local time), cited several reasons for Bitcoin's fall to $75,000: large exchange transfers from wallets related to Trump Media Group, Mark Cuban's Bitcoin sale, increased investor deposits to exchanges, Kevin Warsh's potential appointment as the next Federal Reserve (Fed) chairman, and renewed concerns about military conflict involving Iran.

According to the report, one of the wallets linked to Trump Media Group, operated by the Trump family, sent over $200 million worth of Bitcoin to an exchange. CryptoPotato explained that this transfer was likely related to an intention to sell. This wallet showed similar movements four months ago and is reportedly in a significant loss position on Bitcoin holdings accumulated near all-time highs.

Further selling uncertainty also emerged from remarks by billionaire investor Cuban. Cuban stated that he had lost faith in Bitcoin as a hedge against fiat currency weakness and geopolitical instability, and had disposed of most of his holdings. He believed that Bitcoin's movement during the recent Iran conflict called into question one of the key reasons he held the asset.

Increased exchange deposits were also cited as a factor boosting short-term selling pressure. Ali Martinez, citing Santiment data, reported that approximately $745 million worth of Bitcoin had moved to trading platforms over the past five days. Specifically, 9,664 BTC, worth about $744 million, were sent to exchanges over five days. This trend was interpreted as a signal of immediate selling pressure, given that investors often move funds to exchanges with the intention of selling.

Macroeconomic variables and geopolitical risks also fueled Bitcoin's downward pressure. Bitcoin's previous day's decline occurred hours after Kevin Warsh's potential appointment as the next Federal Reserve chairman. Some market observers believed that the Fed's balance sheet policy would be a significant variable for Bitcoin and cryptocurrencies during Warsh's four-year term. Warsh had previously stated that the balance sheet was excessively large and had hinted at the possibility of quantitative tightening. CryptoPotato explained that quantitative tightening has historically burdened risk assets like cryptocurrencies.

Military tensions surrounding Iran were also identified as a burden. According to the report, the U.S. President reaffirmed plans for new military strikes against Iran after the two sides failed to reach a permanent agreement. CryptoPotato assessed that the war had already affected Bitcoin's price, and if the ceasefire ends and attacks resume, additional price pressure could emerge on Bitcoin.

*Disclaimer: This article is for investment reference only and we are not responsible for any investment losses based on it. The content should be interpreted for informational purposes only.*