Bitcoin, ETH, SOL, XRP, SHIB Prices Plummet, Bloomberg Reveals Reasons Behind the Decline

Bloomberg has disclosed that concerns over inflation and uncertainty have resulted in a decline in trading volumes on cryptocurrency exchanges, causing the prices of Bitcoin, ETH, SOL, XRP, and SHIB to plummet.

Major cryptocurrency exchanges saw a significant drop in trading volumes in April. According to a Bloomberg report on Friday (May 10), trading volumes fell for the first time in seven months after Bitcoin's price plunged from its all-time high of $73,800.

This trend continued into May with a decrease in spot and derivatives trading volumes, leading to further declines in the prices of Bitcoin and altcoins. Bitcoin's price fell to $60,400 as remarks from Federal Reserve officials and new inflation forecast data opposed interest rate cuts.

Data from CCData showed that spot trading volumes on major centralized exchanges like Coinbase, Binance, and KuCoin plummeted by 32.6% in April to $2 trillion. Additionally, derivatives trading volumes decreased by 26.1% to $4.57 trillion, marking the first drop in seven months.

Earlier this year, trading volumes surged after the approval and listing of the US spot Bitcoin ETF in January. However, the Bitcoin halving on April 19 failed to trigger a sudden price increase for BTC or a recovery in the crypto market, with prices falling below $60,000.

Source: CCData

"Consistent with patterns observed in the past two cycles, trading activity on centralized exchanges typically slows down within two months after a Bitcoin halving event," said Jacob Joseph, a research analyst at CCData.

Furthermore, concerns about sticky inflation and stagflation faced by the Federal Reserve have dampened market sentiment. Additionally, rising CPI inflation data, escalating tensions in the Middle East, and potential bank run fears have introduced uncertainty and fear into the market. The reversal in market sentiment led to negative net inflows for spot Bitcoin ETFs.

Binance and CME Report Low Trading Volumes

The global largest cryptocurrency exchange, Binance, saw its spot market share drop by 4% to 33.8% for the first time since September 2023, due to a sharp decline in trading volumes.

Moreover, trading volumes on CME Group, the largest Bitcoin derivatives exchange, dropped nearly 20% to $124 billion.

"Despite the slowdown in trading activity on centralized exchanges compared to the peak in March, the trading volumes are still relatively high compared to other months," Joseph added.

BTC Price Awaits Another Breakthrough

Coin Gape accurately predicted the recent crypto market recovery as Bitcoin chart patterns confirmed a breakout trendline. On Thursday, BTC prices rebounded from $60,630 to $62,585 within a few hours after breaking a downtrend line on lower time frames over three days. Today, the price reached a high of $63,446, and other altcoins like ETH, SOL, XRP, DOGE, and SHIB also saw rebounds.

However, concerns over a pullback remain due to options expiry and upcoming economic data releases this week and next.

Breaking the descending channel since mid-March will favor BTC prices reaching $100,000. This would confirm a rebound post-Bitcoin halving, triggering a broader crypto market recovery.