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A representation of the virtual currency Bitcoin is shown in front of a stock chart in this illustration taken on May 19, 2021.
given by ruvich | Reuters
Bitcoin dropped below $30,000 for the first time since June 22, dragging other cryptocurrencies down.
About $98 billion was wiped out of the entire cryptocurrency market within 24 hours as of 12:29 AM ET Tuesday, according to CoinMarketCap data.
Bitcoin is down more than 6%, ether is down about 9% and XRP is down about 10%, according to CoinDesk data.
The drop in bitcoin came after a massive sell-off in global stock markets. On Monday, the Dow Jones Industrial Average had its worst day since last October.
“There was a massive sell-off in global markets, and risky assets fell across the board,” said Annabel Huang, partner at crypto financial services firm Amber Group.
Huang said there were “concerns about the quality and strength of the economic recovery” and “assets with broader risks are getting weaker, including higher returns.” “Combined with the recent BTC (bitcoin) weakness, this has led to a further decline in the crypto market.”
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Since the all-time high of around $65,000 for bitcoin in mid-April, its price has fallen by more than 50%.
Regulatory audit
Regulators around the world are also looking closely at the crypto space.
Last month, British authorities banned Binance, the world’s largest cryptocurrency exchange, from carrying out any regulated activities in the country. Regulators in Japan, Canada and Thailand have also issued warnings about Binance.
“Overall, we are seeing more regulatory focus on cryptocurrency and bitcoin,” said Vijay Ayyar, head of business development at cryptocurrency exchange Luno.
More sale to come?
A dip below $30,000 could be significant, according to Ayyar, who said the sell-off could drop to test the $22,000 to $24,000 level.
Since then, bitcoin can trade in a range.
“I see bitcoin in the $20-40K ($20-$40K) range for a while now before any bullish trend returns,” Ayar said.
Zhou of Kinetic Capital also sees potential selloffs.
“The momentum of the cryptocurrency market stalled in the first quarter and threatens to reverse further below $25,000 levels,” Zhou said.
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