Crypto Market Faces Setback as Chinese Stocks Fall and Bitcoin Sees Profit-Taking

Bitcoin (BTC) and other major cryptocurrencies faced significant losses on Wednesday after Chinese stocks in Hong Kong extended their declines, dropping by up to 2.9%, despite a strong 5.4% GDP growth for China in Q1.

Following a rally on Tuesday, the market saw a round of profit-taking during the Asian trading session, with the overall crypto market capitalization falling by 3.3%. Bitcoin dropped from a peak of $84,200 to approximately $83,500. Ether (ETH) and Cardano (ADA) were the hardest hit, falling by up to 5%.

XRP also showed steady declines, with the market signaling potential further downward movement. However, in a positive development for XRP, ProShares amended its filing for a spot XRP ETF, with plans to launch on April 30 in the U.S.

On-chain analysis from CryptoQuant indicated that large Bitcoin investors have reduced their selling activity. Sales from these investors dropped from 800,000 BTC per day in late February to around 300,000 BTC recently. This reduction in selling came as these investors locked in losses at lower prices.

However, Bitcoin accumulation by large investors remains sluggish. Their holdings decreased by around 30,000 BTC in the past week, and their monthly accumulation rate fell from 2.7% at the end of March to just 0.5%—the slowest pace since February 20.

The dip in major cryptocurrencies coincided with the continuing struggles in Chinese equities, despite positive growth numbers from China’s economy. The uncertainty surrounding tariffs and broader geopolitical tensions continues to impact risk appetite across financial markets, including crypto.

James Toledano, COO of Unity Wallet, noted that the rising fears of a U.S. recession are influencing market behavior. “Major institutions have revised their forecasts to show that growth could stall at just 0.1% to 1%, and while some think the risks are priced into equities, I am not convinced we’ve seen the bottom yet,” Toledano said.

Despite these concerns, Toledano highlighted Bitcoin’s increasing appeal in uncertain times, stating, “As traditional markets face greater volatility, Bitcoin’s decentralized nature makes it more attractive, especially with the macroeconomic uncertainties surrounding global policies. Though risks remain high for all markets, Bitcoin could be positioning itself as a safer alternative.”