Bitcoin price loses traction as mining profits continue to decline and BTC outflows continue.

The price of Bitcoin (BTC) has fallen 10% in the 10 days to September 3, falling from $64,190 to $57,800. The decline occurred even as the S&P 500 index was 2% below its all-time high and gold was trading just $50 off its all-time high. While some cryptocurrency investors have linked Bitcoin's dip to the broader macroeconomic environment, other factors are also pushing the price below $59,000.

Macroeconomics are bullish but traders sense a change in trend.

Trader DamiDefi explains that bitcoin has been affected by the recession in the United States, but that trend is stabilizing as the focus shifts to “monetary policy and the performance of the US dollar.” The “bullish narrative” going forward for Bitcoin is “protective Federal Reserve policy; […] As the interest rate decreases. Essentially, traders expect that the US will be forced to implement expansionary measures to stimulate the economy.

As the 2-year Treasury yield fell to 3.88% on September 3 from 4.06% two weeks ago, traders are piling up US government debt in addition to the stock market and gold. This trend shows that investors are accepting lower returns in exchange for what is considered to be the safest asset. Part of this uncertainty comes from the labor market, where July data showed a slowdown, with unemployment reaching 4.3 percent.

On the one hand, the U.S. central bank cut inflation, CPI to 2.9% in July, the lowest rate since March 2021. Depreciation will thin out by the end of the year. Currently, the FOMC rates are expected to fall below 4.50% on December 18 at 74% of the market rate, which leaves room for pessimism if macroeconomic data changes.

With the next jobs report scheduled for Sept. 6, Morgan Stanley economists said the U.S. economy added 185,000 jobs in August, enough to support a 0.25% interest rate cut from the Federal Reserve, according to Yahoo Finance. Skepticism among traditional financial investors was evident when NVDA reported better-than-expected earnings, but the stock fell 6% in the next trading session.

However, this does not fully explain why Bitcoin has underperformed compared to other markets, the Russell 2000 index of US-listed small-cap companies, which has remained relatively flat over the past ten days.

Spot Bitcoin ETF exits and declining mining profitability weigh on investor sentiment.

Part of the reason may be the persistent pessimism about Bitcoin exchange-traded funds (ETFs) emerging from the space. When these tools fail to attract buy-in in the long run, they receive more negative attention.

Between Aug. 27 and Aug. 30, the Bitcoin ETF saw net inflows of $480 million, effectively erasing $455 million in inflows from the previous two days, according to data from Farside Investors. While this pattern is unusual and doesn't necessarily indicate a change in investors' perception of Bitcoin's utility and value, the headlines alone may prompt traders to wonder if smart funds are anticipating further BTC price declines.

Finally, Bitcoin investors are concerned that mining profitability, now nearing all-time lows, could prompt a sell-off. Miners currently hold more than 1.8 million BTC, a figure that has remained essentially unchanged over the past two months. The recent drop in Bitcoin's hashrate index, which measures the expected revenue from a given amount of mining power (hashrate), has heightened this concern.

Related: Bitcoin ‘New' Investor Spike Echoes 2019 BTC Price High – Analysis

According to Hashrateindex.com, this metric has dropped to $42 per day per PH, down from $48 per PH per day two months ago. The Hashrate Index is influenced by factors related to trading volumes, such as network complexity, Bitcoin price, and transaction fees. Traders fear that miners may be forced to liquidate their holdings to cover maintenance costs and meet debt obligations, contributing to perceived risks in the current macroeconomic environment.

This article is not intended for general information purposes and should not be construed as legal or investment advice. The views, ideas and opinions expressed herein are solely those of the author and do not necessarily represent the views and opinions of Cointelegraph.