Bitcoins – On Slippery Slope

Bitcoin

Huge selling of the Bitcoin assets, Bitcoin is losing value at an alarming speed. Bitcoin approximately lost over one fourth of its value between Sunday and Monday.

 Hopes were really high for Bitcoin since its anniversary. Bitcoin was making and breaking record on pretty much daily basis. In the previous week, it reached an all time high of around $41,900.

However, mid-day through Sunday, Bitcoin saw a rise but this time it was on the selling side. In between Sunday and Monday. Bitcoin’s value took a nose dive and lost over 26% of its worth.

During the trading hours of New York, on Monday, Bitcoin dropped by 20% of its value. The market for Bitcoin stayed unstable even afterwards as its market value kept fluctuating. Bitcoin went down as low as $30,525 per coin on Monday. This decline in the value of Bitcoin instantly brought down the cryptocurrency’s trade market by $185 billion. The amount is more than the capital of 90% of the companies falling within the index of S&P 500.

Bitcoin did recover some of its value in the following hours. The decline that occurred on Monday is said to be the highest Bitcoin has seen since March 2020.

Matt Maley, chief market strategist of Miller Tabak, termed the sudden decrease and rise in Bitcoin as “Parabolic move”. He assessed that it will eventually go up as we have always observed with parabolic moves. Maley believes that there are many more parabolic movements down the line expected to be around 30% to 60%. He also said they will be followed by equal if not more surges.

When the decline in Bitcoin price had reached somewhere near 14%. The decline in other cryptocurrencies like Bitcoin cash, Ethereum and Litecoin were even more.

It is now time to withdraw some investments from Bitcoin tweeted the chief investment officer at Guggenheim, Mr. Scott Minerd. Mr.Minerd showed his concerns regarding the volatility of Bitcoin in the current period. He stated that with some time Bitcoin could reach over $400,000.

Supporters of Bitcoin believe that the decline and surge were not the typical boom-bust cycles.

They argue that the cryptocurrency has evolved since institutional investors have joined the game. They still claim that Bitcoin has a hedge over weaknesses regular currency and inflation.

Bitcoin is gaining more attention from governmental regulators with its popularity. As more investors are joining in the crypto world every day, Bitcoin could no longer fly under the radar.

On Monday, Financial Regulators of U.K have issued a warning for its citizen looking to invest in crypto. According to them getting involved in the crypto trade business is very risky and one may lose all of its assets. They have also highlighted the issue of volatility of such currencies in their warning.