Bitcoin retreats as record rally spurs profit-taking

[Olsztyn, Poland 13 July 2021. Golden bitcoin coin over defocused stock chart]
Nastco

Bitcoin (BTC-USD [https://seekingalpha.com/symbol/BTC-USD]) fell on Tuesday as traders booked profit after a record-breaking rally that saw the top digital token climb past the $120,000 milestone.

The world’s largest cryptocurrency declined as much as 3.2%, the most in more than three weeks, and was trading at $117,444 at the time of writing.

However, other major cryptocurrencies experienced steeper declines, with Ethereum’s Ether (ETH-USD [https://seekingalpha.com/symbol/ETH-USD]) falling back below $3,000, while Dogecoin (DOGE-USD [https://seekingalpha.com/symbol/DOGE-USD]), Cardano’s ADA (ADA-USD [https://seekingalpha.com/symbol/ADA-USD]), and Stellar’s XLM (XLM-USD [https://seekingalpha.com/symbol/XLM-USD]) dropped about 2% to 3% over the day.

The drop, however, comes after a nearly 26% gain for bitcoin (BTC-USD [https://seekingalpha.com/symbol/BTC-USD]) so far this year as investors respond to renewed optimism around regulatory clarity and digital asset adoption.

Looking beyond short-term price movements, some analysts attribute Bitcoin’s rise to deeper, long-term fundamentals.

Eric Demuth, CEO of the Europe-based crypto exchange Bitpanda, told _TheStreet_ that mounting sovereign debt and a growing desire among investors to hedge against monetary inflation are major driving forces.

In the coming days, crypto legislation [https://seekingalpha.com/news/4467156-bitcoin-more-than-doubles-yy-whats-behind-the-rally] will be a main focus among market participants this week, setting the stage for digital assets to be subject to clear rules and potentially result in wider acceptance across traditional finance.

Crypto stocks to watch: MicroStrategy (MSTR [https://seekingalpha.com/symbol/MSTR]), CleanSpark (CLSK [https://seekingalpha.com/symbol/CLSK]), Hut 8 (HUT [https://seekingalpha.com/symbol/HUT]), Coinbase Global (COIN [https://seekingalpha.com/symbol/COIN]), Riot Platforms (RIOT [https://seekingalpha.com/symbol/RIOT]), MARA Holdings (MARA [https://seekingalpha.com/symbol/MARA]), Bit Digital (BTBT [https://seekingalpha.com/symbol/BTBT]), Greenidge Generation (GREE [https://seekingalpha.com/symbol/GREE]), Bitfarms (BITF [https://seekingalpha.com/symbol/BITF]).

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* Bitcoin more than doubles Y/Y. What's behind the rally? [https://seekingalpha.com/news/4467156-bitcoin-more-than-doubles-yy-whats-behind-the-rally]
* Bitcoin soars past $120K for the first time [https://seekingalpha.com/news/4467001-bitcoin-soars-past-120k-for-the-first-time]