It would seem that the main cryptocurrency managed to find support at around $42,000 and even managed to rise to $45,000. A certain positive was inspired by the statistics on the reduction of commissions in the asset network by 81%. It was quite possible to expect a stir around the first coin. However, there was no happy outcome, and BTC continued to rapidly fall in price against the background of negative news from China. In addition, it can be argued that the asset really reacts very painfully to a series of negative news, each of which deepens the crisis of the cryptocurrency.
Thanks to the new tough sanctions of the Chinese government, which prohibited financial companies in China from carrying out any operations with cryptocurrencies, the asset indicators have begun to decline. This news negatively affected the entire market, but bitcoin reacted to it more painfully than altcoins. Over the past 24 hours, the quotes of the BTC/USD pair have decreased by 13%, to $39,500, and the dynamics of changes in the price of the cryptocurrency suggest that the process is still ongoing. The market capitalization of bitcoin has fallen to the level of $792 billion, and the percentage of market dominance continues to fall at 39%.
It is extremely important to emphasize that the next fall in BTC quotes will further stall the process of institutionalization of the asset. Even before the fall, global financial companies announced the suspension of operations with bitcoin and related structures due to excessive volatility and uncertainty of the asset. The second important reason for the growing distrust of the crypto asset was the rumors about the imminent introduction of sanctions and tighter controls. And after a short time, after numerous statements from investment funds and companies, the news about the tightening of cryptocurrency regulation in China thundered. And following the announcement, the charts recorded a record increase in bitcoin on cryptocurrency platforms since May 2020. For example, over the past two days, 35,000 BTC worth more than $1.3 billion has appeared on the Binance platform.
This indicates a significant outflow of the audience from the bitcoin network, which may well continue its decline to the level of $30,000-$35,000. The whales began to convert the first cryptocurrency to more promising altcoins, Ethereum. Do not forget about the Ripple token, which again rode the wave of confidence and shows impressive growth. According to statistics, ETH managed to attract $27 million of investments, Cardano was replenished by $6 million, and Polkadot by another $3 million. An important signal that causes the redistribution of the market was the news that May 2021 was the first month when the flow of institutions of the ether network completely surpassed the performance of the bitcoin network.
A series of negative events that have accompanied the first cryptocurrency for more than a month and a half has caused a sharply increased level of distrust in the asset. Bitcoin has come under heavy criticism for almost every aspect - from technical to informational. The lack of updates, a significant oversaturation, and a negative news background caused a sharp outflow of institutions, which in turn led to a reduction in cryptocurrency quotes. Soon, BTC may sink even more, as evidenced by the historical component. Trader Peter Brandt clearly pointed to similar patterns in 2018 and 2020, which marked the beginning of a bearish trend. A similar situation can likely occur with the current performance of bitcoin because there is every reason to believe that the news background will continue to deteriorate.