The onset of 2024 instilled optimism among crypto enthusiasts, with some predicting Bitcoin (BTC) would hit $100,000 by year-end. However, continuous selling pressure during April and June, punctuated by a brief rebound in May, has left BTC struggling to maintain a $60,000 floor as Q2 concludes.

Bitcoin commenced Q2 just below $71,000. As the quarter nears its end, BTC trades at $60,800, marking a 14% decline. Despite support from anticipated spot ETF approval, Ether (ETH) outperformed BTC but still fell by 5% this quarter. Broader market declines, particularly in altcoins, dragged the CoinDesk Index down over 21%. Notable decliners included Solana (SOL) down 30%, Ripple (XRP) down 23%, and Dogecoin (DOGE) down 42%, while Ether led with a 5% drop.

Dissipating Positive Catalysts

Bitcoin’s underwhelming Q2 performance could be seen as a correction within a broader bullish trend, which saw BTC rise nearly five-fold from January 2023 lows to over $73,500 in March 2024. Initial catalysts included the approval of spot Bitcoin ETFs and anticipated substantial interest rate cuts from the U.S. Federal Reserve. However, inflation remains stubbornly high, and the expected monetary easing has not materialized, with no rate cuts anticipated this year.

With ETF inflows now stagnant or reversing and diminishing hopes for lower interest rates, investors are cautious, awaiting new catalysts.

Read more: Spot Ether ETFs: A Regulatory Green Light or False Hope for ETH’s Classification?

Projections for Q3

Markus Thielen of 10X Research foresees potential further decline for Bitcoin, suggesting it might hit $55,000 in the near term, citing ten factors influencing this downtrend. Trend-following funds might exacerbate this decline by taking short positions.

Additionally, the political landscape adds to the uncertainty. Despite some bullish sentiment around Donald Trump’s pro-crypto stance, Thielen points out that President Biden’s performance could lead to a stronger Democratic contender in the upcoming election, affecting market sentiment.

Thielen also highlights seasonality, noting that Q3 has historically been the weakest quarter for Bitcoin, with an average return of just 5% over the past 13 years, compared to over 60% in the second and fourth quarters.