Bitcoin is in a very dark place at the time of writing. After trading for a new all-time high of $64,000 per unit in mid-April of this year, the currency has once again (for the second time in the past few months) dropped below the $30,000 range and is now trading for just over $29,000. This means that in just three months alone, the world’s number one digital currency by market cap has lost more than $35,000 off its price and more than 50 percent from its value.
Bitcoin Drops Further; Trading for Under $30K
In addition, bitcoin appears to be dragging other coins lower as well. Just under $90 billion in total valuation was removed from the crypto space over the course of a single day. Bitcoin itself is down more than five percent, but many other major altcoins have joined the fall. Ethereum has dropped six percent, while Ripple’s XRP has taken a nine percent dip during this time.
Experts believe that the fall that occurred with bitcoin and the crypto space is likely due to a recent selloff in global stock markets. Annabelle Huang – partner at the crypto financial firm Amber Group – explained in a statement:
There has been a broad selloff in global markets. Risk assets are down across the board. Broader risk assets turned weaker including high yields. Coupled with recent BTC (bitcoin) weakness, this just sent the crypto market down further.
Others, however, differ in their opinions of what is potentially bringing down the entire industry. Many analysts feel that China has entered territory in which there is no return from. The country has worked hard these past few weeks to basically obliterate its entire mining industry, which is a big feat for many reasons.
For one thing, China – at one point – accounted for approximately 65 to 75 percent of all mining operations in the world. Now, many former companies are either dealing with displacement or being forced to close altogether. This is also not the first time that China has gone after cryptocurrency businesses, having banned local crypto exchanges about four years ago.
Other analysts also feel that ongoing COVID fears are likely leading to market drops. The alleged Delta variant of the coronavirus is meandering throughout several regions, and it looks like traders are looking to hang onto as much money as they can for the time being.
Jehan Chu – founder of the crypto enterprise Kenetic Capital – mentioned in an interview:
All signals are red as BTC (bitcoin) continues to be weighed down by China’s ultimate crypto ban and worsening macro-economic conditions from a surge in COVID variants.
More Losses in the Coming Days?
In addition, he is also anticipating a greater selloff in the crypto community, continuing his discussion with:
Q1s crypto market momentum has stalled and is threatening further reversal potentially below the $25K levels.