(Bloomberg) -- Bitcoin briefly dropped below $60,000 for the first time in more than a month, with volatility increasing ahead of a software update in

Bitcoin Briefly Falls Below $60,000 Ahead of Halving Software Adjustment

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2024-04-17 17:00:07

(Bloomberg) -- Bitcoin briefly dropped below $60,000 for the first time in more than a month, with volatility increasing ahead of a software update in the blockchain that has long been touted as bullish for the cryptocurrency.

The original digital asset fell as much as 5% to $59,888, before paring the decline. Bitcoin has dropped by about 18% since reached a record $73,797 on March 14. Other smaller tokens such as Ether, Solana and Dogecoin slumped on Wednesday. Crypto—related stocks, including MicroStrategy, Coinbase and Marathon Digital, also traded lower.

The drop comes in the lead-up of a highly anticipated code update in Bitcoin taking place as soon as Friday. The quadrennial event, called the halving, has been considered as a positive catalyst for Bitcoin prices since it reduces supply of new tokens from the blockchain. But concern over whether the halving is already priced in against the backdrop of a risk-off investment environment have prompted an extended rout.

“People are looking to derisk as it remains to be seen if the halving will be a market moving event or a non-event overshadowed by the ETF,” said Nathanaël Cohen, co-Founder at INDIGO Fund. “There is an additional macro factor putting more pressure on risk assets (the Middle East tensions).”