Bitcoin’s return from dramatic weekend sales has faded

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Bitcoin fell 0.4% against the US dollar earlier this month, above the $ 56,000 mark.

The weekend’s sinking was a rather dramatic end to a month-long rally, which was completed by Coinbase’s huge IPO last week, which valued the crypto exchange at nearly $ 100 billion. Coinbase shares opened lower on Monday and traded 1.3% lower in the middle of the morning.

Bitcoin collapsed because of “countries like Turkey making noise about banning Bitcoin as a payment method and also talking about further review of the US Treasury,” said Brad Bechtel, global head of FX at Jefferies.

The cryptocurrency market is becoming more and more crowded: China is creating a digital yuan and playing with the idea of ​​launching the currency at the Beijing Winter Olympics in 2022. Meanwhile, the Bank of England has announced the creation of a central bank digital currency as well as a working group to explore its uses.

“Big Tech is also developing its own versions of cryptocurrencies,” Action Economics analysts said in a note to customers. “All of this represents significant future competition for bitcoin.”

At the same time, the cryptocurrency still has a lot of rising supporters.

“We do not believe that any of these factors change the fundamental story for Bitcoin, which still seems to be supported by constrained supply and the expansion of institutional and retail investor adoption,” wrote Win Thin, global head of foreign exchange strategy at Brown Brothers Harriman. a note.

The US dollar index also fell on Monday, and the greenback fell 0.5% against a basket of its rivals.

Elsewhere in the market, shares are turning red, following last week’s record high for Dow (UNJUST) and S&P 500 (SPX).
The Dow fell 0.3%, or 105 points, in the middle of the morning. S&P also fell 0.3% and S&P Nasdaq Composite (COMP) traded 0.7% lower.

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