The world’s largest cryptocurrency, Bitcoin (BTC), continues experiencing selling pressure, dropping an additional 1.68% in the last 24 hours. At the time of writing, Bitcoin is trading at $27,268 with a market cap of $529 billion. Interestingly, Bitcoin is currently facing its first monthly drop for 2023. As of now, in May, Bitcoin is down by 6.5%, yet still boasts a 68% year-to-date gain. At one point, hitting a high of $31,000, Bitcoin had an impressive year-to-date increase of 84%. However, the current selling pressure has reduced gains to 67%.
Although Bitcoin investors displayed confidence during the banking crisis earlier this year in March, it seems short-lived. John Wu, president of Ava Labs Inc., told Bloomberg that for another wave of Bitcoin and crypto-asset buying to occur, there needs to be a demonstration of real utility and development to entice those who are crypto-curious.
Another key factor for Bitcoin is the increased network activity. This includes meme coins and non-fungible tokens (NFTs) in the form of Bitcoin Ordinals. Bitcoin Ordinals with BRC20 standard and NFTs have massively gained traction, causing a spike in BTC transaction fees and network congestion. As per on-chain data provider Glassnode, Bitcoin miners were earning $17.8 million in transaction fees during the peak of the BRC-20 frenzy, declining to $1.7 million currently in fee revenue.
However, this elevated fee revenue still remains significantly higher when compared to historical values. Over the last four weeks, traditional assets such as stocks, bonds, and gold have performed much better. Amid fluctuations, Bitcoin briefly rose above $28,000 this week due to the news of the US raising its debt ceiling. Unfortunately, the increase was short-lived, and Bitcoin appears to be following shifts in the US equity market once again.
If the selling pressure continues, it’s possible that the BTC price could drop further to around $23,000. While investors showed faith in Bitcoin amid previous crises, current market shifts display the potential for fluctuation. Ultimately, increased utility and adoption will be crucial in attracting more user interest and strengthening the position of cryptocurrencies, including Bitcoin, in the global markets. As an enthusiast, it is essential to stay informed and conduct thorough research before investing, as the presented content reflects the author’s personal opinion and is subject to market conditions.
Source: Coingape
