Crypto prices declined slightly on Friday as investors booked profits and as concerns about the recent Coinbase hack continued. Bitcoin price retreated to $104,130, down from near $105,000, while Ethereum dropped from $2,700 to $2,570.
The top laggards in the crypto market were coins like Dogwifhat (WF), Celestia (TIA), Optimism (OP), The Sandbox (SAND), and Ethena (ENA). Let’s explore the top reasons why they retreated.
Coinbase hack contributed to the crypto crash
One top reasons why crypto prices are down is the Coinbase hack. In a statement, Coinbase, the biggest crypto exchange in the US, said that hackers bribed customer representatives to steal customer data. They took sensitive data like date of births, ID numbers, and some banking details.
The hackers then demanded a $20 million ransom to delete the data. While no funds were lost, Coinbase estimated that the hack would cost at least $400 million, which will affect its profitability in the current quarter.
The company also said that, instead of paying the ransom, it would pay a $20 million bounty to anyone with information leading to their arrest and conviction.
A major hack on Coinbase is a big deal since it is the biggest player in the United States. It is also the main custodian of exchange-traded funds (ETFs) by companies like Ark Invest and Grayscale, holding coins worth over $120 billion.
Still, the crypto market can handle such a hack. For example, the sector thrived after the Mt. Gox hack in 2014 and the collapse of FTX in 2022. Most recently, it did well afte hackers siphoned Ethereum coins from Bybit, a popular crypto exchange.
Crypto prices dropped because of profit-taking
Bitcoin and most crypto prices dropped because of profit-taking among investors since most of them were up by double digits from their lowest levels in April.
Bitcoin jumped from $74,000 in April to $104,320 on Friday. Most notably, Ethereum jumped from $1,300 to $2,700, while the market cap of all Solana meme coins soared from $6 billion to $15 billion.
Read more: Odds of Solana price soaring to an all-time high in 2025 are rising
Profit-taking is a common occurrence when such a big rally happens since, even in a bull run, prices don’t move up in a straight line.
Read more: Coinbase stock price could surge by 70% after S&P 500 inclusion
Will cryptocurrencies go back up?
There is a high likelihood that Bitcoin and other cryptocurrencies will resume their bullish trend in the coming weeks. First, Wall Street analysts have started to upgrade their S&P 500 Index forecasts and lowering their recession odds. Goldman Sachs analysts expect that the index will rise to $6,100, a move that would also benefit crypto prices.
The main reason for the change in tune is that the US reached a truce with China, and has hinted of more deals in the coming months.
BTC price chart by TradingView
Second, there are signs that Bitcoin price is about to pop, which will lead to more demand for altcoins. As the chart above shows, it has formed a cup and handle pattern, and is now in the process of forming a bullish pennant pattern. These patterns often leads to a strong bullish breakout.
If this happens, the next Bitcoin price to watch will be at $110,000, followed by $120,000. Such a move will lead to more gains among top altcoins.
Bitcoin also has more catalysts. Supply of Bitcoin in exchanges has dropped to the lowest level in over five years, while demand continues rising. Strategy has accumulated coins worth over $60 billion, while ETF inflows have jumped.
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