Although the cryptocurrency market stabilised on Friday, some traders might still be uneasy.

According to CoinGecko, the price of Bitcoin fell to a weekly low of $59,573 earlier today, a significant decrease from its all-time high of $73,000 last month. By midday, the price of Bitcoin had increased by about 9% to $65,000. Why does it happen?

Fundstrat Global Advisors' head of digital asset strategy, Sean Farrell, told Decrypt that macro is ultimately what is driving the bus. "And we encountered this perfect storm of bad news last Friday."

Growing geopolitical unrest in the Middle East, along with better-than-expected U.S. economic statistics, cast doubt on investors' view for potential rate reduction from the Federal Reserve, startled investors throughout the world last week, according to Farrell.

It follows because, amid uncertain times, investors flock to the greenback for shelter from the fallout, he said.

“People rush into the asset that they can remit payments in, and that’s the U.S. dollar, so I think you saw a lot of panic selling,” Farrell said. “In the background of that, from a financial conditions perspective, we had a really hot CPI print.”

The Bureau of Labor Statistics’ Consumer Price Index (CPI) indicated that inflation was unchanged at 3.5% in the 12 months through March compared to its prior release.

That stoked fears the U.S. central bank could be forced to hold rates higher for longer to bring inflation back down to the Fed’s target of 2% annually, according to Grayscale’s Managing Director of Research Zach Pandl

“Perceptions around Federal Reserve rate cuts have moved from the middle of this year to much later,” he told Decrypt. “The Federal Reserve is now pivoting away, at least on the margin, from rate cuts and that’s had a negative impact on a lot of assets.”

Within crypto, Pandl sees one key factor that may be contributing to Bitcoin’s recent weakness.

Inflows into spot Bitcoin ETFs, “which were at boomy levels in February and March,” have petered off as of late, he said.

Since last Friday, for example, spot Bitcoin ETFs have seen net outflows totaling $319 million, according to data from analytics platform Coinglass. Still, market participants have had only a handful of months to digest the investment vehicles that were approved in January.

“Many of us believe we will see another wave of ETF demand as these products go through an approval process among a broader set of financial advisors and platforms,” Pandl said.

“But they’ve leveled off more recently and so you don’t have that positive catalyst for price.”

Though Bitcoin’s rattle has caught crypto traders’ attention, outsized losses among so-called altcoins may be contributing to the crypto community’s malaise, pseudonymous crypto influencer @basedkarbon said on Twitter after popular meme coins like Solana’s Dogwifhat (WIF) plummeted last Friday.

“Alts nuked so hard this weekend that now most of [Crypto Twitter] thinks the bull market is over,” the account wrote Monday.

According to a number of indicators, the bull market appears to be continuing, as Glassnode analyst Brett Singer stated to Decrypt.

He claimed that the market is similar to past cycles when comparing the current price of Bitcoin to the price at which it was purchased—a figure known as the cryptocurrency's MVRV Z-Score.

Regarding the shocks in the Middle East, Singer stated, "These events definitely do impact it, but the fundamentals themselves say that we're still growing in that direction." "The market is still moving with momentum and is behaving a lot like it has in past cycles."