Bitcoin is trading at a price of $63,200. This figure represents an 11% monthly decline and the first loss of value since August 2023, according to TradingView data. Similarly, the CoinDesk 20 Index, which measures the performance of liquid digital assets, lost approximately 20% of its value during the month, falling to 2,185 points. This situation shows that cryptocurrencies (altcoins) other than Bitcoin are also going through a difficult period.

So, what are the factors that disrupt Bitcoin’s upward trend? It is possible to mention a few important reasons. First of all, the decreasing possibility of interest rate cuts by the US Federal Reserve (Fed) negatively affects investors’ appetite. Additionally, the decline in demand for US-based Bitcoin exchange-traded funds (ETFs) also indicates a recession in the Bitcoin market. Finally, the recent dominance of a general risk aversion trend in financial markets has been driving investors away from assets with high volatility such as Bitcoin.

However, there are also negative developments. The expansion of stablecoin use in the Bitcoin market serves as a safe haven for investors and provides stability.

While the future course of Bitcoin remains uncertain, another important issue that analysts follow closely is the US Treasury Department’s quarterly debt renewal announcement on Wednesday. Singapore-based cryptocurrency research company QCP Capital predicts in this statement that if it is decided to increase short-term bond issuance, liquidity will increase, which could support risky assets.

QCP states in its market note: “The Quarterly Debt Rollover Announcement (QRA) on May 1 could lead to more issuance of short-term US bonds. This could increase liquidity by reducing the Reverse Repo (RRP) market, which currently stands at USD 400 billion.” .”

The US Treasury Department announced on Monday that it plans to borrow more in the April-June quarter. This higher-than-expected borrowing need may cause bond supply to increase, yields to rise, and thus investors to move away from risky assets.

The Treasury Department also announced that it expects to maintain a balance of $850 billion in the Treasury General Account through the end of September. This figure is slightly higher than the previously expected $750 billion.

Bitcoin’s market dominance rate, that is, its share in the crypto market, has shown significant developments recently. Bitcoin reached its highest dominance rate in three years, rising to 57% after a six-month period of consolidation. This rise means that Bitcoin may continue to overshadow altcoins in the coming months.

In the note sent to its customers by the cryptocurrency market research company Fairlead Strategies, it states that the increase in the dominance rate may enable Bitcoin to occupy an advantageous position against altcoins in the medium term. The company states that this situation is also compatible with the weekly Relational Rotation Chart (RRG). Because, according to RRG, most altcoins appear to be in a downward trend.

Fairlead Strategies also highlights that Bitcoin’s rise has undone most of the gains observed in altcoins in early 2021. This means that Bitcoin can continue to consolidate its leadership position in the market in the coming period.

As a result, the end of Bitcoin’s seven-month winning streak could be a turning point for the cryptocurrency market. Factors such as the US Federal Reserve’s interest rate policy, spot ETF demand, and the general risk perception in financial markets will continue to have a significant impact on Bitcoin’s price course.

However, analysts predict that the increase in Bitcoin’s market dominance and the expansion of stablecoin usage may contribute to Bitcoin’s further strengthening in the coming period.