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Bitcoin and cryptocurrency prices have struggled over the past month, with around $ 1 trillion erased from the value of the combined crypto market since it peaked at around $ 2.5 trillion in mid-May.
The price of bitcoin fell to just over $ 30,000 per bitcoin this week before rebounding thanks to El Salvador’s plans to adopt bitcoin as its official currency alongside the U.S. dollar. Elsewhere, Binance’s other top five cryptocurrencies by valueethereum, BNB, cardano and dogecoin also lost ground, each falling between 5% and 10% this week.
Now, despite the bitcoin price rebounding to $ 40,000 over the past two days, analysts at Wall Street giant JPMorgan JPM have warned that the “swerve” in recent weeks points to a “bear market” ahead.
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The price of bitcoin has struggled since a massive selloff in mid-April ended the huge bitcoin in early 2021 and … [+] crypto bull market, with smaller ethereum coins, Binance’s BNB, Cardano, and Dogecoin also retreating.
2018 Chesnot
“We believe the return to the backlash in recent weeks has been a negative signal indicating a bear market,” JPMorgan strategists led by Nikolaos Panigirtzoglou wrote in a memo that was first reported by the Bloomberg financial newswire. , warning of the crash in the price of bitcoin over $ 50,000. by bitcoin in May is an “unusual development and a reflection of the current weakness in demand for bitcoin from institutional investors.”
Analysts pointed to the weakness of the bitcoin futures market which they said echoed the 2018 bear market which was called a crypto winter for its devastating effect on cryptocurrencies at all levels.
The bitcoin and crypto price boom over the past few months, which has seen thousands of percent like Ethereum, Cardano, Binance’s BNB and even bitcoin rival dogecoin, has been driven by a combination of institutional adoption so many expected and fearful of retail investors. absence (FOMO).
As traders and investors crammed into these so-called “altcoins,” the market dominance of bitcoin crypto, which measures the weight of the overall cryptocurrency market relative to bitcoin, has fallen to a low. just over 40%, compared to around 70% at the start of the year.
According to JPMorgan’s analysis, Bitcoin’s dominance may need to return to over 50% before the bull market returns. Bitcoin’s dominance fell below 50% at the end of April for the first time since July 2018, according to crypto price data from CoinMarketCap.
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Despite a flood of positive bitcoin news, the price of bitcoin has struggled over the past month.
Coinbase
The bullish run in the price of bitcoin was brought to a halt by Tesla billionaire TSLA in May when he rolled back plans to allow Tesla customers to make purchases with bitcoin over concerns over its staggering environmental impact.
The sale, sending shock waves through the larger cryptocurrency market and causing Ethereum to lose half of its value in just two weeks, has been exacerbated by fears of a crackdown on bitcoin and cryptocurrency. in China.
However, some observers of the cryptocurrency market believe the price of bitcoin could be “nearing a bottom.”
“During a deep dive into the bitcoin market corrections, the -49% drop in May marked the 6th largest such event, which could be considered one of the biggest monthly corrections in the month. story, “Lukas Enzersdorfer-Konrad, COO at Austria-based crypto exchange Bitpanda, wrote in an emailed note.
“That said, corrections of this magnitude are common and should be expected. Bitcoin ended the month down 35% and still struggles to find a new support area. With price down nearly 50% per from its all-time high, some bullish news suggests bitcoin is approaching a low. “
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