November started with an unexpected deterioration in the cryptocurrency market as Bitcoin, which had started to rise in the last week of October, quickly lost momentum.

The highly anticipated “Moonvember” began with an unexpected disaster and collapse of $73,000 as of October 31 to $69,000 on November 1 and essentially disappear $296 million in liquidationsmost of them are long positions. Despite the bulls Bitcoin price support was maintained at $69,000, the rapid decline has raised questions among many cryptocurrency traders.

According to cryptocurrency expert Ash Crypto on social media platform X, this rapid decline in Bitcoin’s price can be attributed to four main factors.

Key reasons for the fall in Bitcoin price

According to Ash Crypto, Bitcoin’s recent price is not a basic result of cryptocurrency-specific events, but rather a reflection the broader economic landscape. He noted that there are currently many reports suggesting that Iran may be planning military action against Israel from Iraqi territory. The potential escalation of conflict in the region appeared to create uncertainty among Bitcoin investors, and many may have opted to exit the markets.

“As we all know, war is bad for Bitcoin and cryptocurrencies.” analyst he said.

In addition to the growing conflict, Ash Crypto also highlighted the tech giants’ recent earnings reports as another factor behind Bitcoin’s price crash. Major technology companies such as Microsoft and Meta recently released earnings reports that, despite exceeding expectations, showed rising costs related to artificial intelligence. This led to declines in many other technology stocks, which spread to other financial markets, including the cryptocurrency industry.

Another factor that Ash Crypto highlighted is the recent augment in U.S. Treasury yields, particularly 10-year bonds, which are currently trading above 4.3%. Higher yields make government bonds a more attractive alternative, making investors less willing to invest in more volatile assets such as cryptocurrencies.

Finally, the latest reading of core personal consumption expenditure (PCE) rose just above 2.7%. Ash Crypto noted that this augment in core inflation could prompt the Federal Reserve to adopt a more hawkish stance. This could prompt the Fed to adopt higher interest rates or delay rate cuts. Both scenarios could dampen demand for Bitcoin, which thrives in low interest rates, as the September 18 interest rate cut showed.

Looking to the future: what’s next for Bitcoin?

Like many other crypto analysts, Ash Crypto remains confident that Bitcoin’s latest decline is only transient. He drew parallels to Initial October market declineexpecting that November, the “moon month”, will follow a similar trajectory. Interestingly, the analyst believes that Bitcoin still has the momentum and market interest needed to cross $80,000 before the end of November.

At the time of writing, Bitcoin is trading at $69,678 and is up 4% in the last 24 hours.

Featured image from Pexels, chart from TradingView