Bitcoin's Rollercoaster Ride: What's Next After the Big Drop?

Bitcoin has taken a nosedive, losing nearly half its value from its peak last October. It's now worth less than it was back in November 2024. This isn't just a small blip; it's a significant drop. Things started to go downhill in early February. A massive sell-off happened, wiping out over $2. 7 billion. This was the biggest drop since 2022. Several big events triggered this. One was the news that Kevin Warsh might become the next Federal Reserve chair. Another was the poor performance of some major tech companies, like Microsoft, which saw a 10% drop. Even precious metals took a hit.So, what's causing all this? Well, a lot of money is flowing into AI-related stocks. This is pulling liquidity away from crypto. Bitcoin is struggling in both upswings and downswings, a classic sign of a bear market. Even when buyers stepped in near the $60, 000 mark, the market is still shaky. ETF flows are negative, and digital asset treasuries are sitting on big losses. This makes it hard for institutions to jump in. Looking ahead, things are still uncertain. Experts predict more choppy and volatile price action in the near term. For a real recovery, three things need to happen: a return of the Coinbase premium, renewed ETF inflows, and stabilization in basis rates. Right now, institutional ETF and derivatives flows are driving the price.