Bitcoin has broken the key support level of $28,500 on Saturday and has dropped to a new low this year. BTC is down by 20% in the past six days and is currently trying to gain the support of near $24,000.
The sudden trigger for the crypto crash appears to be a massive selling by the investors amid the heightened inflation fear in the US.
While BTC has fallen to a new low for the year, every other altcoin including Ethereum, are bleeding prices since the weekend.
Ethereum has fallen to a level for the year and is currently trading at $1,235 (IST: 15:31).
Bitcoin has witnessed similar crashes in the year 2015 and 2018 when Bitcoin had lost more than 80% of its value.
After reaching a high of $1150 in November 2013, BTC witnessed a crash where the price kept falling for nearly a year until it reached a low of $160. It took BTC nearly 770 days to recover from the low before it started making new highs.
It followed a similar pattern from 2017 to 2018 where the price dropped from the highs of $20,000 to nearly $3000, after which it again took nearly 714 days to recover and start witnessing the recent bull run of 2021. Bitcoin has witnessed an all-time high of $69,900 during the bull run of 2021.
Since there are no set regulations for bitcoin and the crypto market is driven by sentiment, could it be possible for bitcoin to follow a similar pattern as in the past and give a new all-time high in the near future? well, we can just wait and watch.
Experts take on Bitcoin
Experts suggest that the plunge in crypto prices are indicating the falling risk appetite of the investors. Crypto is considered one of the most volatile instruments for investment purposes due to its volatility and uncertainty.
Darshan Bathija, CEO of crypto exchange Vauld stated that the recent inflation numbers in the US have had a negative impact on most markets. He also added that investors worry that unless inflation numbers start dropping soon, the US Fed may have to tighten reigns by increasing interest rates at a faster pace than anticipated.
Coindesk has quoted an expert saying that only a small number of altcoins are likely to survive such market movements
Analysts at WazirX Trade Desk have stated“Bitcoin faced yet another significant correction, falling by over 10% and dropping to nearly $25,000, the lowest in over 5 months. Interestingly, the Dollar Index(DXY) is also at a six-month high, gaining 2% in the last day alone leading to a drop in the Stock and Crypto markets. On the daily time frame, the BTC trend has broken below the long-formed triangle pattern. Immediate and key support is expected at $24,000. The RSI dropped below 30 as Bitcoin entered the oversold zone,”
