Bitcoin, akin to other peers, has wiped off about 70 per cent of its value from peak. It plunged to the lowest in about 18 months after the freezing of withdrawals by the Celsius lending platform added to concern that systemic risk in the crypto ecosystem will accelerate the digital-asset market meltdown.
Apart from this, recession and inflation fears also haunted investors.
The global cryptocurrency market cap was trading sharply lower at the $908.51 billion mark, dropping as much as 11 per cent in the last 24 hours. However, the total cryptocurrency trading volume zoomed about 64 per cent to $153.34 billion.
Bitcoin plunged significantly over the past 24 hours and is trading at $21,000 with increased selling pressure since the weekend, said Edul Patel, CEO and Co-founder of Mudrex. “If sellers are determined, Bitcoin can fall to $20,000.”
The market continued to slip following the rise in inflation in the US, he added.
“There is a sharp carnage in the crypto markets and the community is under severe distress. Bitcoin and other tokens have a little comfort to offer to investors. It’s havoc to be exact,” said Kunal Jagdale, Founder & CEO, BitsAir Exchange.
Bears are in ruckus mode and crypto investors have no refuge now that Bitcoin has taken a big hit, he added. “If it falls below the $20,000 mark, things might get uglier and investors should brace themselves for the worst price action.”
- The Tron network’s stablecoin, USDD, lost its peg to the US dollar, dipping to as low as 91 cents, as crypto markets nosedived as investors grew increasingly concerned about persistently high inflation, tightening financial conditions and a potential recession.
- Crypto exchange Crypto.com and lending platform BlockFi plan to cut a total of more than 400 jobs, joining an expanding list of crypto companies looking to reduce headcount.
- Bank of England Governor Andrew Bailey reiterated his stance on cryptocurrencies, stating that the asset class has ‘no intrinsic value.’
- Michael Saylor’s MicroStrategy (MSTR) is sitting on an unrealized loss of more than $1 billion on its bitcoin (BTC) holdings as the price of the largest crypto by market value touches $22,900 in Monday trading.
- The world’s largest crypto exchange by trading volume, Binance, resumed withdrawals of bitcoin (BTC) after a pause early Monday, the company said.
Tech View by Giottus Crypto Platform
With the weekend selloff intensifying and the Fed’s declaration of 40-year-high inflation of 8.3 per cent, Bitcoin (BTC) has fallen to its lowest level since December 2020. It’s currently trading just above $20,000, after having witnessed double-digit losses in a single day. It is also down by 70 per cent from its all-time high in November. The market, including the rest of the altcoins, will continue to be impacted by BTC’s lows.
After trapezing for weeks in the $30-32,000 range, Bitcoin has forsaken the parallel descending channel it had been forming for some time, to plunge below its crucial support level of $25,000.
When considering yearly timeframes, BTC’s value has plummeted by 80 per cent twice – once in 2014 and then in 2018. If such a drop ensues, Bitcoin may fall further to $14,000. Interestingly, both these years were the mid-way zone to the next Bitcoin halving event similar to 2022.
To restore the market confidence, BTC needs to reclaim the $25,000 psychological resistance before it sets to pursue the $28,000 level – the crucial .618 retracement level. Investors should wait for the BTC to form its bottom before they deploy new capital.
Resistance: $24,700, $25,000, $27,000
Support: $22,500, $20,000
(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of Economic Times)