Chinese New Year and Bitcoin will finally have fireworks for the king

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The Chinese New Year (Lunar New Year) is fast approaching. It often has a strong influence on cryptocurrency prices. Chinese New Year and Bitcoin have a “red” past together as the price of this cryptocurrency fluctuates significantly in January.

Chinese New Year is celebrated on a different day each year as it is based on the lunar calendar. This year, the Chinese New Year will begin on January 22, 2023 and end on January 24, 2023.

During this period, many Chinese over-the-counter (OTC) services will be shut down, leading to high crypto volatility. According to research, Bitcoin always experiences a 15% to 50% dump from early to mid-January, which often causes Bitcoin to drop to its lowest value of the year. Will this coincide with a bitcoin bloodbath like in previous years?

Bitcoin’s recent price surge

The cryptocurrency market is booming as bitcoin surges above the $21,000 mark. It broke the level on Saturday, the first since Nov. 8, 2022. Bitcoin price was stuck in a tight range around $16,000-$17,000 for weeks before the latest breakout.

The overall market capitalization of the crypto universe topped $1 trillion over the weekend for the first time since early November, according to data from CoinMarketCap. The global cryptocurrency market capitalization today increased by more than 2% in the past 24 hours to $1.04 trillion, according to data from CoinMarketCap.

Read more: McDonald’s will enter the metaverse this Lunar New Year

Chinese New Year and Bitcoin Price Dump History

Bitcoin is always in red during the weeks leading up to Chinese New Year. In 2019, Bitcoin price steadily dropped from $3,491 just before Chinese New Year to $3,397 during the holidays.

According to CoinMarketCap, in 2020 prices fell below the $8,300 resistance ahead of the Chinese New Year. There was a rally to $8.5,000 on the first day of the holiday. However, history cannot help but repeat itself and on the same day it fell back below USD 8.3000.

In 2021, the tides seemed to have turned with a gradual rise from $32,000 to $39,000 in the first week of February and a huge 2-day rally up to $48,000 in the few days leading up to the festival. However, during the Chinese New Year, prices still started to come back to $46.2,000. Thankfully, that didn’t wipe out the pre-Chinese New Year gathering.

In 2022, prices fell sharply to levels below $37,000 just before the holidays. Bitcoin prices then rose sharply to a high of over $39,000 amid the Chinese New Year holiday.

Bitcoin Price Prediction in 2023 and Chinese New Year Effect

Looking at Bitcoin’s recent performance, experts believe that maybe this year history won’t repeat itself. In-depth discussion of what to expect from Bitcoin in 2023 has experts questioning a few things. There are not many active opinions on the impact that the Chinese New Year of 2023 will have on the price, there is a general feeling that there are several other factors that will weigh on the e value of the coin much more than the festival.

Also read: Bitcoin price jumps to $65,000? Here’s what the data and on-chain analysts suggest

CoinGape has an experienced team of native content writers and editors working around the clock to cover the news globally and present the news as fact rather than opinion. CoinGape editors and reporters contributed to this article.

The content presented may include the personal opinion of the author and is subject to market conditions. Do your market research before investing in cryptocurrencies. The author or publication assumes no responsibility for your personal financial loss.

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