Bitcoin Recently Plummeted More Than 30 Percent And This Caused It
Other major currencies have also undergone significant losses
Over a single night, the price of Bitcoin went down by more than 30 percent. For the first time in 3 months, the price of the popular cryptocurrency went lower than $50k (AUD). In, the price of Bitcoin reached more than $75k (AUD) per coin after Tesla announced its purchase of Bitcoins worth $2 billion.
However, it is not just bitcoin. Other major currencies have also undergone significant losses. For instance, the Ethereum crypto plummeted more than 20 percent. At the same time, the Binance coin plummeted 27 percent.
What caused the Bitcoin price to drop?
So, what is causing the dip? Well, that is due to the sudden sell-off triggered by some bad news recently. Factors like platform outages, tax returns, and tweets Elon Musk are to blame. According to the CEO of Webull, Anthony Denier, “All of these things combined are likely to have rattled investors causing them to sell.”
While the crypto market was already affected by these factors, China placed another nail in the coffin. On Tuesday, financial bodies in China warned financial institutions to stop using cryptocurrencies in services such as settlement, clearing, registrations, and trading.
In a statement, these bodies said, “Recently, cryptocurrency prices have skyrocketed, and plummeted, and speculative trading of cryptocurrency has rebounded, seriously infringing on the safety of people’s property and disrupting the normal economic and financial order.”
Previously, China had banned crypto exchanges and ICOs already. However, individuals had no limitations regarding holding any crypto. But that quickly seems to be changing now.
Typically, Bitcoin seems to get the most coverage due to the massive dip in price, enough to cause panic among coin holders.
The Senior Technical analyst at StockCharts, Julius de Kempenaer mentioned that Bitcoin and the crypto market could recover rapidly. However, he added that the downside risks are high as compared with the upside potential.
Considering the highly volatile nature of the crypto market, nobody can say anything about the future of Bitcoin and other cryptocurrencies with 100 percent certainty.
In other news, Google announced many key updates in the Google I/O 2021 recently, including a new Android design and improved AI-language system.
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