Bitcoin Slips After Weekend Selloff. Why the Crypto Bull Case Holds.

“Analysts are describing last week’s pullback as a ‘bull market breather.’ During extended, multi-month price rallies, periods of profit-taking where holders sell and capture profits from bullish bets made are expected,” said Aditya Das, an analyst at blockchain research group Brave New Coin. “Sharp dips in between periods of heavy price gains are nothing unusual for experienced crypto traders. Much of the market remains confident that last week’s dip was simply a profit-taking interruption to a pre-halving, ETF-driven 2024 Bitcoin price rally.”

Indeed, crypto analysts and traders remain optimistic that Bitcoin prices still have more room to run.

Billions of dollars have flowed into spot Bitcoin exchange-traded funds (ETFs) since they were approved by U.S. regulators in January, buoying prices amid a fresh wave of investor interest in crypto. The so-called halving also looms in April, marking an upcoming cut to issuance of new Bitcoin that will restrict token supply at a time when demand has been rising, providing further support to prices.

Positive risk sentiment in wider markets also has helped, with the

S&P 500

and

Nasdaq

stock indexes near record levels. A busy week on the macroeconomic front—including the latest Federal Reserve monetary policy decision on Wednesday—is likely to move stocks and could also impact digital assets.

Beyond Bitcoin,

Ether

—the second-largest crypto by market value—was down 2% at $3,500, having traded above $4,000 last week. Smaller tokens or altcoins were weaker, with

Cardano

and

Polygon

both falling 4%. Memecoins were mixed, with

Dogecoin

down 4% but

Shiba Inu

hovering around flat.

Write to Jack Denton at jack.denton@barrons.com