Bitcoin, Cryptos Plunge Lower, Continuing Downward Trend
Bitcoin and Ether are continuing to plunge in price, with Bitcoin having lost almost half of its all-time-high value and being down 4% this morning, hovering around $33,000. The U.S. economy remains under pressure related to the COVID-19 pandemic, and investors are seeing both risk and opportunity in the crypto market.
“The cryptoasset market has plunged amid a wider global sell off in growth and tech assets,” Simon Peters, eToro market analyst, wrote in a note sent to GOBankingRates. “Bitcoin is now trading at its lowest level since July 2020 and has fallen some 50% from its all-time high above $69,000 which it reached in November 2021.”
“Ether likewise is now trading around similar levels to July 2020 and has lost some 50% of its value since its ATH in November. The cryptoasset began the week above $3,200 but has traded down severely to just under $2,400 now,” he added.
The cryptocurrency market had around $130 billion wiped off its value over the last 24 hours, CNBC reported.
Other cryptos are in the red as well, including Solana, which is down 13% in the past 24 hours, and Cardano — down 8.4% in the past 24 hours — according to CoinMarketCap.
Discover: 10 Cheap Cryptocurrencies To Buy
Ron Levy, CEO and co-founder of The Crypto Company, told GOBankingRates that the specific correlations between traditional financial instruments and crypto are not clear yet.
“We do know traditional markets are a little uneasy right now. There’s a lot of instability with the inflation rate over 7% while growth is at 3%. It wouldn’t be accurate to assume that this doesn’t affect the crypto market,” Levy said. “The question is exactly how it affects the crypto market. While Bitcoin is significantly down from its peak in November, it is still up 7% for the year. From a traditional standpoint, fluctuations like this are very nerve-wracking. For those that have been in the crypto space for a number of years, we think of it as just another dip on the way to higher highs.”
Indeed, as usual, many investors are buying the dip. Digital asset investment products saw inflows totaling $14.4 million last week, breaking the prior five-week run of outflows, according to a CoinShares report.
“The inflows came later in the week during a period of significant price weakness, suggesting investors, at current price levels, are seeing this as a buying opportunity,” CoinShares detailed.
Bitcoin saw inflows totaling $14 million last week, having suffered outflows of $317 million — representing 1% of assets under management — in the prior five weeks. As for Ether, it continued to see outflows, with $16 million of outflows last week, indicating much of the recent bearishness among investors has been focused on Ether rather than Bitcoin, per CoinShares.
In terms of altcoins, Cardano, Polkadot and Solana saw inflows totaling $1.5 million, $1.5 million and $1.4 million respectively.
More From GOBankingRates