Bitcoin price fell to lows of $30,000 on Wednesday, confirming the largest price decline so far in this present bull run. Coming after a week of successive dips, Wednesday’s price plunge puts Bitcoin at its lowest level since early February and nearly 53% below its all-time highs of $64,899.
Bitcoin price has seen four corrections from new price highs so far in 2021, out of which this recent 40% is the biggest. With the plunge beneath $40,000 on May 19th, Bitcoin thus traded nearly at the same price as at the period of Tesla’s $1.5 billion buy-ins. This wipes out 100% of the entirety of the carmaker’s Bitcoin profits.
The majority of Altcoins also suffered remarkable losses except for selected tokens such as Polygon (MATIC, +12.75% ), SUSHI (+4.23%), ARK (+25.42%) trading in green at the time of writing. The majority of Altcoins were seen posting double-digit losses, such as Binance Coin (-16.58%), Internet Computer (-26.17%), SHIBA INU (-22.42%).
BTC/USD Daily ChartBitcoin was trading at $37,023 as of press time. Ethereum traded to lows of $2,850 before rebounding to its present price of $2,737.
High Bitcoin inflows to centralized exchanges have prompted predictions of further bearish waves in the last few days. Justin Chu, senior trader at Wave Financial noted that Bitcoin’s weak technical structure coupled with bearish fundamentals from high inflows of bitcoin to exchanges may suggest that the correction was bound to occur.
Fear could also be pointed to as one of the factors that contributed to the huge price drop. Lex Moskovoski, CIO at Moskovoski Capital, noticed the pervading fear in the space stating that:
”Bitcoin SOPR is lowest since March 2020. People on average are selling at loss, Fear.”
The Crypto Fear and Greed Index, a metric that gauges the current sentiment in the Bitcoin market, has fallen to “extreme fear” levels not seen since April 2020. Arcane research earlier indicated that The Crypto Fear and Greed Index had fallen to 21, down from a “greedy” level of 73 seen in the prior week.
On the positive end, new reports are hinting that India’s government may be reconsidering its stance on cryptocurrencies with the formation of a new regulatory panel. The move comes amid increasing support for overturning recommendations made by a committee led by former finance secretary Subhash Garg in 2019 for a blanket ban on crypto-assets on the grounds they have become outdated.
On the flip side, a recent Reuters report indicates that China is on the verge of a cryptocurrency ban. according to the news report, China is prohibiting its financial institutions and payment companies from providing cryptocurrency-related services.
However, presently the sentiment remains mixed, with some traders taking the opportunity to buy the dip. Lex Moskovski noted, “16,835 Bitcoin withdrawn from exchanges in last 10 minutes, someone’s buying fear.”
Image Credit: Glassnode, Shutterstock
Keep in mind that we may receive commissions when you click our links and make purchases. However, this does not impact our reviews and comparisons. We try our best to keep things fair and balanced, in order to help you make the best choice for you.
