Bitcoin (BTC) is in a critical position, experiencing declining demand despite a recent break above the $28,000 price level.

Bitcoin was down, 4% in the past 24 hours at $27,808. The largest cryptocurrency was withdrawing from levels above $28,000 that it briefly surpassed on Monday for the first time in several weeks.

After several weeks of trading roughly between $26,500 and $27,500, Bitcoin trading has been more volatile over the past seven days.

This prevailing bearish scenario does not provide substantial support for the asset’s actual price movement to counter additional declines.

A recent analysis conducted by CryptoQuant shed light on the true situation, emphasizing that bitcoin’s initial upward momentum was driven by growing market demand, which appears to have slowed significantly in recent times.

According to data extracted from bitcoin trading volume on exchanges, the report notes that the price surge that began earlier this year was sustained by a noteworthy increase in BTC trading volume on derivatives and spot exchanges.

In particular, BTC experienced a noteworthy rise from its initial price of $16 541 at the beginning of the year to a high of $26 386 in March, representing a noteworthy increase of 59% in three months. Data indicates that bitcoin trading volume witnessed substantial growth on both spot and futures exchanges.

Increased demand during the rally served as a hedge against potential price corrections, but trading volume on the spot exchanges experienced a significant decline after BTC reached $26 000. However, volume on derivatives exchanges remained high, offering enough support for the asset to reach the $30,000 milestone in April.

CryptoQuant’s report highlights that demand on futures exchanges has also declined, leaving Bitcoin with a shortage of demand. This exposes the asset to further declines if bearish traders take command of the scene.

Bitcoin Hits $28,000 for the First Time in 20 days

This decline in demand came amid bitcoin’s recent recovery from the $28,000 level after 20 days. May has demonstrated to be a challenging one for BTC. The asset has been involved in an uphill battle to avoid further declines below the $25,800 threshold.

CryptoQuant reported that according to data from bitcoin’s trading volume on exchanges, the report observes that the price surge that commenced earlier this year was sustained by a notable rise in BTC trade volume across spot and derivatives exchanges.  

Bitcoin is in a Dangerous Position as Demand Dries up – 1

BTC started May at $29 233, but fell to $25 811 as of May 12, reflecting an 11.7% decline in less than two weeks. The asset subsequently recovered from lows below $26 000, but has struggled to maintain a position above $27 000, according to a BTC Price graph from May 30^th published by Trading View.

After a remarkable 4.51 % gain on May 28th, BTC successfully regained its $28 000 level, as reported by crypto.news. Nonetheless, subsequent declines have led to its precise $27,786 value at the time of this report. Despite these recent fluctuations, the asset has managed to maintain a 3.4% gain over the past seven days.

By Marina Meza

Bitcoin’s growing popularity in retirement savings discussions is evident, with key financial advisers advocating its inclusion in 401(k) plans and its potential to generate high returns.

Traditional retirement savings in the United States predominantly revolve around the 401(k) plan. However, many American employees are re-evaluating this conventional path for various reasons, as an unexpected competitor emerges. Bitcoin, the leading cryptocurrency, is increasingly seen as the top saving technology.

Recent changes in the financial landscape highlight the rise of Bitcoin in retirement savings discussions and the reassessment of the 401(k) plan, amid growing economic uncertainties.

The Waning Appeal of a 401k Retirement Plan

Decades ago, 401(k) plans emerged as a model of financial security, but recent events indicate a change in opinion. Financial commentators have deliberated on the pause on 401(k) account contributions. Reasons include bear market potential and a lack of satisfactory growth, leading many to reconsider their investment strategy. Other factors include the high probability of scams.

As a matter of fact, the Lincoln Police Department recently reported a phone scam involving a 67-year-old woman who was scammed out of her 401(k) retirement savings. She reportedly lost $52,000 in the fraud. Initially, she was made aware of fraudulent charges on her Amazon-linked bank account.

Believing she was dealing with her bank’s Fraud Department, she got into phone conversations with a man who persuaded her to withdraw from her 401(k) to buy Bitcoin for two months. The scammer promised you two checks in the mail for $69,999. However, these checks never arrived.

The case further highlights the vulnerability of these savings plans. Even Shawn Plummer, CEO of The Annuity Expert, highlights the real threat of 401(k) accounts losing money, casting doubt on their advertised safety, in the following terms:

“Your 401k retirement plan can lose money. However, it is essential to understand that this does not mean all your money is gone forever. The stock market is constantly fluctuating, which means the value of your investments will go up and down over time,” said Plummer.

Bitcoin: A New Era in Employee Savings

Amid emerging doubts about 401(k) plans, Bitcoin is entering the mainstream narrative. A recent report sheds light on the pros and cons of holding Bitcoin in a 401(k) plan, which is becoming the focus of retirement savings discussions.

Douglas Boneparth, the founder of Bone Fide Wealth, suggests that investors who want to allocate a portion of their retirement savings to cryptocurrencies should consider focusing on Bitcoin. As the most prominent cryptocurrency, it presents a less complex opportunity for speculation, according to Boneparth.

Similarly, renowned financial advisor Ric Edelman argues that including Bitcoin in 401(k) plans emphasizes the potential for high returns. Supports the potential of Bitcoin investments within a 401(k) plan. The expert signals a shift in the perception of cryptocurrency from a speculative asset to a viable investment option.

Edelman added that American employees adopt a dollar cost averaging strategy when including Bitcoin in 401(k) retirement plans. This strategy involves constantly investing a set amount of money from each paycheck over a long period of time. It effectively mitigates volatility, creating a more stable investment environment. According to Edelman, “this makes it the ideal place to buy Bitcoin”.

All in all, US employees’ growing interest in Bitcoin signals a potential paradigm shift in retirement savings. While the traditional 401(k) plan was once considered the gold standard of retirement preparation, it is undeniable that the transformation of the retirement savings landscape is underway, led by the pioneering spirit of Bitcoin and that of those who have adopted it.

By Audy Castaneda

Over the past 90 days, Artificial Intelligence (AI)-based cryptocurrencies have suffered a sharp correction in price and volume.

Artificial Intelligence (AI)-based cryptocurrencies lost 25% of their value over the past 90 days. This pullback in the crypto market contrasts with the powerful push in the stock markets. In fact, the actions covered by this technology print almost +24% to the Nasdaq so far this year.

Three months ago, the currencies linked to this technology enjoyed a great boost. Some $4 billion in capitalization hit these cryptos amid the nascent AI rush. However, since then they began to lose traction. Until now, approximately $1 billion would have evaporated.

The push of the Nasdaq 100, led by NVIDIA, Microsoft and Alphabet, is strongly tied to enthusiasm for AI. That strength doesn’t seem to support their counterparts in the virtual currency market, though, at least not to the same extent.

The Waning Development of AI-Based Cryptocurrencies

By the end of February, AI-powered cryptocurrencies appeared to be only in the early part of their growth. The push led to the creation of some 74 different coins that looked promising on paper. However, from that date until now reality has been contrary to that assumption.

The ghost of the Metaverse seems to surround the coins of this new buzzword among investors. It is worth noting that coins like Mana are currently stagnant, after losing much of their value in 2022. These tokens were not immune to the winter in the digital currency market.

Metaverse currencies, however, had the characteristic of being high at the same time that the investment was in the forefront. Currently, however, their value is dwindling, despite the fact that investors seek exposure to that technology.

Whether the fate of AI-based cryptocurrencies is the same as those covered in the Metaverse is uncertain. Nevertheless, these assets can be profitable, despite being high risk and volatility assets.

Value of Coins Falls Along with Trade Volume

The fall in value of AI-based cryptocurrencies is preceded by the loss of investor interest in them. Many of these tokens are, in fact, not linked to an Artificial Intelligence project that persuades investors to invest in them.

The latter is the key to the difference between these tokens and Nasdaq stocks, which are now experiencing strong bullish momentum. In any case, during the peak of the AI ​​coins at the end of February, the trading volume of these marked a 24-hour high of $444.39 million dollars on the 27th of that month. In parallel, as already mentioned, the capitalization reached $4.03 billion.

Now, in both aspects they hit rock bottom. According to data from the analytics portal, Cryptoslate, the total AI tokens (currently 89) have an average valuation of $2.93 billion. Consequently, despite the fact that 15 new coins emerged in the last three months, in that same period, $1.1 billion evaporated.

An important fact that is noted about this new submarket is that it now occupies 0.26% of the entire crypto market. Three months earlier, at its peak, AI-based cryptocurrencies held 0.37%. Similarly, the top five tokens suffered losses without exception.

Over the last 7 days, the outlook has improved for these tokens, and the rally in the broad crypto market helps them. For example, INJ now boasts a weekly growth of +7.89%. Likewise, GRT has +5.72% in the same period. AGIX +13.22% and OCEAN +7.06% just to name a few.

By Audy Castaneda