This week has been anything but easy for Bitcoin investors. After peaking at $69,000 on December 16th, the price of Bitcoin has dropped more than 20% and is now trading at about $56,600 per coin.
What do you think the future holds for crypto?
Almost 20 percent of Bitcoin has been lost in less than two weeks, approaching bear market territory.
On Friday morning, the price of bitcoin dropped more than 5 percent from the previous day and was trading at about $56,600 per coin, about 18 percent below the peak reached earlier this month of $69,000.
For six straight days, bitcoin has declined in price and the trend is widespread among cryptocurrencies. Ether, the native currency of the Ethereum blockchain and the second-largest crypto, has fallen about 15 percent from its peak of almost $4,800.
At last night’s close, the digital currency was trading at $4,125 per coin, down more than 2.5 percent in the previous 24 hours.
Smaller tokens, such as binance coin, solana and cardano, led the decline over the past day, with each falling anywhere between 19 percent and 24 percent from earlier this month’s highs.
A high degree of volatility is something seasoned crypto investors are used to.
In the spring, bitcoin had reached a record high price, but then it plummeted by over half during the summer before rallying back and setting a new record.
Early this decade, bitcoin, when it was still a niche project with relatively few holders, experienced even larger price swings.
Jamie Cox, managing partner at Harris Financial Group and financial adviser, told Bloomberg that the thing that really knocked the wind out of crypto during the 2016/17 Bitcoin winter was rising interest rates and a drain on liquidity.
The term “winter” is often used by cryptocurrency experts to describe periods of massive price declines that follow rapid price spikes. One such winter struck bitcoin in 2017 after it rallied from $900 per coin to a record $20,000.
Bloomberg reported that Craig Erlam, senior market analyst at foreign exchange company Oanda, considers the bitcoin correction a non-issue.
Even if it drops to $50,000, it would still be relatively minor given how far it’s come in recent months, Erlam commented.
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Author
Chris Munch is a professional cryptocurrency and blockchain writer with a background in software businesses, and has been involved in marketing within the cryptocurrency space. With a passion for innovation, Chris brings a unique and insightful perspective to the world of crypto and blockchain. Chris has a deep understanding of the economic, psychological, marketing and financial forces that drive the crypto market, and has made a number of accurate calls of major shifts in market trends. He is constantly researching and studying the latest trends and technologies, ensuring that he is always up-to-date on the latest developments in the industry. Chris’ writing is characterized by his ability to explain complex concepts in a clear and concise manner, making it accessible to a wide audience of readers.
