Bitcoin falls 2% to $115K, down 7% from record high — What's behind the weakness in the crypto token?

Bitcoin, the largest cryptocurrency, declined by over 2 per cent on Monday, August 18, reaching around $115,000. On Monday, August 18, Bitcoin prices dropped 2.12 per cent at $115,559.05 at 10:30 am, according to coinmarketcap data. 

Bitcoin's market capitalisation stood at $2.30 trillion, while trading volume in the last 24 hours stood at $55.73 billion. Meanwhile, Ether, the second-largest token, declined by up to 3 per cent at $4,349 on Monday.

Bitcoin reported losses after reaching a record $125,514 on August 14, while Ether on the same day surged to within $100 of its all-time high set in November 2021. The two leading tokens gained momentum from a surge of institutional investment, primarily driven by digital-asset treasury companies, news agency Bloomberg reported.

What's behind Bitcoin's latest dip?

The market “has seen continued profit-taking since a new all-time high printed last week,” Caroline Mauron, co-founder of Orbit Markets told Bloomberg. “The momentum behind the crypto treasury boom appears to be losing steam," she added.

Stocks rise 

Meanwhile, Asian stocks rose as investors ahead of Donald Trump’s meeting with Ukrainian President Volodymyr Zelensky.

The MSCI Asia Pacific Index increased by 0.4%, driven by gains in China and Japan, while South Korea underperformed. European share futures rose by 0.3%, and S&P 500 futures went up by 0.1%. A Shanghai-listed stocks index is on track to reach its highest closing level in ten years.

The dollar index remained largely unchanged. Treasuries edged up, with the 10-year yield dipping by one basis point to 4.30%. Gold increased by 0.4% as cryptocurrencies declined.

Investors are looking for Trump-Zelensky talks to anticipate the markets' direction, following the summit with Vladimir Putin that concluded without new sanctions on Russia or its oil buyers.

Notably, the market reaction to Trump-Zelensky talks is expected to be mild “as a lot still rests on Ukraine’s willingness to accept the terms from Russia,” Jordan Rochester, head of macro strategy for EMEA at Mizuho Corp told Bloomberg. “But hope is a powerful thing and this outcome will keep the slow grind of higher risk sentiment alive and well," he added.

(With inputs from agencies.)