Bitcoin is heading toward its longest losing streak of 2024.
As of May 9, 2024, Bitcoin shows minor declines. According to CoinMarketCap data, after reaching its all-time high of $73,798 in mid-March, Bitcoin's price entered a two-month oscillating downtrend, currently hovering around $61,000.
While cryptocurrencies are notoriously volatile, 2024 had not previously seen Bitcoin decline for four consecutive days or more. Historical data shows:
- Last 5-day losing streak: October 2023
- Last 4-day losing streak: November 2023
With current trends, Bitcoin may set its 2024 record for continuous declines. Coingecko reports the total crypto market capitalization has shed over $500 billion (~¥3.61 trillion) since March highs.
Two-Month $3.6 Trillion Decline: Crypto ETF Demand Weakens
The total cryptocurrency market capitalization neared $3 trillion in March but has since fallen over 17%, erasing $3.6 trillion in value.
Key developments:
- The SEC approved 11 spot Bitcoin ETFs in January (including BlackRock, Fidelity, and Ark Investments)
- Grayscale's Bitcoin holdings dropped 41.2% from 496,600 BTC to 291,800 BTC since January
- ETF inflows initially boosted Bitcoin to March highs, but momentum has stalled
Analysts cite:
- Declining US spot Bitcoin ETF inflows
- Fed's prolonged high-interest rate outlook
- Hong Kong's crypto ETF launch failed to lift market sentiment
Notably, April saw Bitcoin ETFs' first net outflows (~$170 million), with trading volumes shrinking since mid-April. The T3 Bitcoin Volatility Index and Ethereum's equivalent metrics hover near two-month lows.
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Market Dominance Shift
While Bitcoin fell 17% from March peaks, decentralized finance (DeFi) sector dropped 26.9%, with niche sectors like gaming declining further. Paradoxically, Bitcoin's market share among cryptocurrencies has increased during this downturn.
Visa Casts Doubt on Stablecoin Adoption
Stablecoins—cryptocurrencies pegged to stable assets like the US dollar—aim to reduce volatility. Examples include USDT (Tether) and PayPal's PYUSD.
However, a May Visa/Allium Labs report reveals:
- Over 90% of stablecoin transaction volume originates from non-organic sources (bots/large traders)
- Only $149 billion of April's $2.2 trillion stablecoin transactions came from genuine payments
This challenges proponents who claim stablecoins could revolutionize the $150 trillion payments industry. Despite:
- PayPal launching PYUSD in 2023
- Stripe enabling merchant stablecoin payments in April
Airwallex's Pranav Sood notes: "Stablecoin adoption remains embryonic—they lack short/mid-term competitiveness."
Adoption Barriers
- Transaction double-counting on platforms like Uniswap inflates volume metrics
- US businesses still use checks for 40-60% of payments, reflecting slow tech adoption
- Visa processed $12+ trillion in 2023—stablecoin disruption could threaten traditional payment processors
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Cryptocurrency Market FAQs
Q: Why is Bitcoin's price declining?
A: Multiple factors including reduced ETF inflows, macroeconomic conditions, and profit-taking after March highs contribute to the downtrend.
Q: Are stablecoins failing as payment tools?
A: Current data suggests most stablecoin activity isn't from genuine payments, indicating they're not yet mainstream payment solutions.
Q: How does Bitcoin's market share rise during a downturn?
A: Investors often flock to Bitcoin ("digital gold") during crypto market stress, causing altcoins to decline more sharply.
Q: Will crypto ETFs recover?
A: Long-term adoption depends on regulatory clarity, institutional interest, and broader market conditions.
Q: What's the outlook for decentralized finance (DeFi)?
A: DeFi remains highly correlated with Bitcoin's movements but faces additional regulatory and smart contract risks.
Q: Should investors be concerned about the $3.6 trillion market cap loss?
A: Crypto markets are cyclical—similar drawdowns occurred before previous bull runs, though past performance doesn't guarantee future results.