On Wednesday, Bitcoin was on a downward slope and its value descended to be traded as low as $34,295. Bitcoin lost about 7.8% of its value within a matter of 24 hours. Bitcoin’s value fluctuated around $35,000 in the trade market on Wednesday. However, until the end of the day recovered some of its value and was being traded for around $33,420.
Analysts are suggesting the decline in the value of Bitcoin was because a large number of users disposed offBitcoin. The trend of selling continued throughout the day caused the value of Bitcoin to stumble so much.
Within the last two weeks, Bitcoin broke its own record many times and reached as high as $41,900 per asset. The surge was caused by retail investors joining the trade followed by institutions growing interest in Bitcoin. Two giant market sectors joining in trades of a single product could easily raise its value hundreds of times.
More so, such a rapid rise in its value gave investors the opportunity to cash in huge profits within a short time. Asset was definitely sold by investors to cash in profit thereby shifting the trend of surges with a decrease in value. Afterward, Bitcoin has struggled to surge its value anywhere close to $40,000.
Market strategists have time and again regarded the $40,000 mark as critical for Bitcoin. Nikolaos Panigirtzoglou strategist at JPMorgan through a not on Friday stated investors are expected to be leaving Bitcoin. He says the interest will keep declining unless Bitcoin regains its higher marks.
Some analysts are suggesting that Bitcoin may soon decline somewhere near $32,000 and hold that position before any future changes. Senior market analyst Craig Erlam said in the near-term Bitcoin may descend down to $33,000 and become vulnerable to change. He concluded that only the $30,000 level matters for Bitcoin.
However, there are conjectures that Bitcoin may make another parabolic move and take a huge leap forward. As the drop in value of Bitcoin may make it an attractive buying option. With institutions and other investors jumping back in to trade the cryptocurrency, it may rise above making another record.
Then there is the possibility that some of the investors, losing profits, may pull out and transfer their funds somewhere else. This in turn may likely cause Bitcoin to take dive after dive before setting down on the year’s newest low.
Mark Cuban, a billionaire investor called Bitcoin’s rally to be a bubble similar to the internet stock bubble in the nineties.
U.S. President Joe Biden’s Treasury Secretary Janet Yellen said in Senate that the trade of cryptocurrency needs to be curtailed. He alleged that the Bitcoin and other crypto-assets are being used for funding illicit trades. She said that such decentralized currency has every possibility to be utilized by terrorists for funding purposes.