The start of 2024 brought high hopes for the bulls, with expectations of Bitcoin (BTC) reaching $100,000 at some point in the year. However, April and June saw persistent selling pressure, causing the price to struggle to stay above $60,000 as the quarter comes to an end, despite a brief bounce in May.
As the second quarter began, Bitcoin was trading just below $71,000. By the close of the quarter, it had dropped to $60,800, marking a decline of over 14%. Ether (ETH) outperformed Bitcoin during this period, even though it still experienced a 5% decrease in the second quarter.
The broader CoinDesk Index faced a significant setback, falling more than 21% in the last three months due to substantial declines in many altcoins. Solana (SOL) plummeted by 30%, Ripple’s XRP dropped by 23%, and Dogecoin (DOGE) saw a sharp decline of 42%. Ether was the best performer in the index, despite its 5% slide.
Bitcoin’s lackluster performance in the second quarter could be viewed as a correction within a larger bullish trend that saw the token surge nearly five times from its January 2023 lows to a new all-time high above $73,500 in mid-March of this year.
The anticipation and subsequent approval of the spot Bitcoin ETF, along with significant inflows into the new funds, were key drivers of the price rise. Additionally, macro factors such as expectations of interest rate cuts by the U.S. Federal Reserve played a role. However, inflation remains uncooperative, with no monetary policy easing in the U.S. so far, leading to a decrease in buyer activity until a new catalyst emerges.
Looking ahead to the third quarter, Bitcoin entered a downtrend on June 20, with analysts like Markus Thielen from 10X Research outlining ten reasons why the price may decline to $55,000 in the near term. Thielen also pointed out that the third quarter historically has been the weakest, with an average return of just 5% over the past 13 years, compared to much higher returns in the second and fourth quarters.
Moreover, the uncertainty surrounding the U.S. presidential election adds to the market’s volatility, with potential implications for the crypto market depending on the outcome. As the quarter comes to a close, market participants are closely watching for new catalysts that could drive the next phase of price action in the crypto space.
