According to cryptocurrency analysts, the recent price plunge of Bitcoin is largely unrelated to the recent U.S. government shutdown or the so-called AI technology bubble.
Many market participants had speculated that Bitcoin—recently dropping to its lowest level in nearly eight months—was still being affected by the widespread macroeconomic uncertainty brought about by the U.S. government shutdown that ended last week.
Others believe that concerns over the AI bubble are spreading to the cryptocurrency market. Victoria Scholar, head of investment at Interactive Investor, recently stated:
However, on Wednesday, on a podcast interview released on YouTube, on-chain analyst Rational Root refuted the theory linking the U.S. government shutdown to Bitcoin's price drop.
"I wouldn't attribute the entire Bitcoin pullback to the government shutdown," Rational Root said.
Instead, the analyst suggested that Bitcoin's decline from its historical high of $125,000 on October 12 could be due to "excessive leverage levels in Bitcoin futures."
Meanwhile, Bitcoin analyst PlanB also dismissed the notion that AI concerns could be affecting Bitcoin's price.
"We can remove the AI bubble theory from the list of reasons for Bitcoin's decline," PlanC stated in a post on X on Wednesday, noting that Nvidia's "performance is very strong."
On Wednesday, Nvidia reported record third-quarter revenue of $57 billion for the period ending October 26, a 62% year-over-year increase, surpassing Wall Street's forecast of $54.7 billion.
The analyst indicated that the list of reasons is becoming "increasingly smaller."
"Only the four-year cycle astrology narrative and delayed global liquidity remain," PlanC said.
"And the four-year narrative is likely to be broken," he added, which has been a continuing topic of debate within the recent cryptocurrency industry.
Cory Klippsten, CEO of Swan Bitcoin and a Bitcoin advocate, recently told Cointelegraph Magazine, "The famous four-year price cycle of Bitcoin is likely over, ended by institutional adoption."
Global liquidity is typically tracked through the M2 money supply and is a common discussion topic among Bitcoin holders. Jack Mallers, CEO of Strike, recently stated, "Bitcoin is most sensitive to liquidity. It moves first. It is a truth machine."
Rational Root noted that Bitcoin now has a "clean slate" and more potential opportunities for upward movement.
"In the past three years of the bull market, we have actually seen three resets, reaching levels comparable to the bear market," he said. He added that each reset has "allowed us to go higher."
"To be fair, I think it will move in a more gradual structure," Root said.
Some market analysts recently indicated that the end of the U.S. government shutdown and the resumption of regular legislative sessions could trigger a surge in the approval of new cryptocurrency exchange-traded funds (ETFs) by the U.S. Securities and Exchange Commission (SEC) in 2026.
Related: Report: Abu Dhabi Investment Authority (ADIC) doubled its Bitcoin ETF holdings in the third quarter
Original article: “Analysts: Bitcoin (BTC) pullback should not be blamed on U.S. government shutdown or AI bubble concerns”
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