Bitcoin price today: Recent crash proves a point against cryptocurrency | Tech News

Bitcoin price today: Recent crash proves a point against cryptocurrency

Bitcoin price today: The cryptocurrency has lost almost 20% in less than two weeks, proving that extreme volatility remains a hallmark of crypto investing. 

| Updated on: Aug 21 2022, 22:02 IST
Bitcoin price today: Despite the crash, in the world of Bitcoin, it’s largely business as usual with bullish conviction intact. (REUTERS)

Bitcoin price today: The world's biggest cryptocurrency has lost almost 20% in less than two weeks, proving that extreme volatility remains a hallmark of Bitcoin investing.  Yet in the world of Bitcoin, it's largely business as usual with bullish conviction intact -- in contrast to traditional markets where moves on this scale are met with alarm. The largest cryptocurrency edged higher after earlier slipping as much as 3.4% to $55,663 on Friday. 

“This correction seems more like a natural breather in a bull run, as well as a healthy flushing out of leverage,” said Noelle Acheson, head of market insights at Genesis Global Trading. “Meanwhile, mainstream awareness continues to spread, adoption continues to grow, market infrastructure continues to develop, and the Taproot upgrade sets the stage for even more progress in Bitcoin's eventual use cases.”  

You may be interested in

MobilesTablets Laptops
7% OFF
Apple iPhone 15 Pro Max
  • Black Titanium
  • 8 GB RAM
  • 256 GB Storage
Google Pixel 8 Pro
  • Obsidian
  • 12 GB RAM
  • 128 GB Storage
34% OFF
Samsung Galaxy S23 Ultra 5G
  • Green
  • 12 GB RAM
  • 256 GB Storage
Apple iPhone 15 Plus
  • Black
  • 6 GB RAM
  • 128 GB Storage

Here Are Crypto Charts to Watch as Bitcoin Price Drops Below $60,000

Some analysts say a sharp pullback is normal after prices skyrocketed 40% in October. China's crypto crackdown and new U.S. tax-reporting provisions that are being viewed as unfriendly to crypto investors have also soured sentiment.

Also read
Looking for a smartphone? To check mobile finder click here.

“During the 2016/17 Bitcoin winter, the thing that really took the wind out of the sails of crypto was when interest rates rose and liquidity was draining from the system,” said Jamie Cox, a financial adviser and managing partner at Harris Financial Group.

Price swings of 20% or more aren't uncommon among cryptocurrencies. After hitting a record of almost $65,000 in early April, Bitcoin slumped more than 50% by late June before turning higher again. After hitting nearly $53,000 in early September, it retreated about 25% over the next couple of weeks. 

Aficionados of digital assets are used to big swings and often undaunted by pullbacks. They often view Bitcoin as a modern day store of value and inflation hedge, though such arguments are controversial.

“When we see a big move, we take a step back and say, has anything fundamentally changed? Has there been a material event or development, or is it driven by flows and transitory sentiment?” said Hunter Horsley, chief executive of Bitwise. 

“This move looks like the latter,” Horsley added. “When we look at the fundamental thesis and drivers of the space, they continue to look incredibly optimistic.”


Near-term indicators point to a breather for bitcoin

Near-term indicators point to a breather for bitcoin

(Reuters) - Cryptocurrency market indicators such as average bitcoin funding rates, inflows into crypto investment products and the ratio of old-to-new coins being sold suggest a near-term consolidation for the sector and lower odds of a year-end rally bitcoin bulls are predicting.

Bitcoin price today rose 1.6% on Friday to $57,850.56 but was on track for weekly losses of over 11%, its worst week since May. It is 16% lower than its Nov. 10 record high of $69,000. Ether, the second-biggest cryptocurrency by market value, was 14% off of its peak at $4,202.45.

Market participants cited profit-taking after bitcoin hit those highs, its increasing sensitivity to global inflation expectations and regulatory headwinds as behind the week's declines.

Concerns that creditors of Mt Gox, a crypto exchange that collapsed in 2014, could liquidate their bitcoin-denominated repayments also weighed on sentiment.

In the past week, traders have become less willing to pay to hold long positions in bitcoin futures. Average funding rates, a barometer for sentiment in the perpetual swaps market, have fallen to around 0.008%, according to cryptocurrency analytics platform CryptoQuant, their lowest since early October.

Positive funding rates imply that traders are bullish, as they must pay to hold a long position.

"Do we set new highs before the end of the year? I'd say we've come a long way," said Paul Eisma, head of trading at crypto firm XBTO Group in New York, adding he expected bitcoin to trade between $53,000 and $57,000 for the rest of the year.

Bitcoin's Taproot upgrade over the weekend, its first major update since 2017 that enables its blockchain to execute more complex transactions, was well telegraphed and largely priced in as the asset rallied into the event, market experts said.

There is also increased spending of older coins -- associated with long-term investors exiting their positions -- though it remains small in relative magnitude, according to blockchain data provider Glassnode.

A ratio between short-term and long-term bitcoin holders signaled stable equilibrium between 1-week and 1-year old coins, meaning a balanced distribution between newer and older, "smart money" investors and indicating a likely period of consolidation. Tops in price are typically established when large volumes of coins are held by newer investors.

Crypto product inflows have also been subdued in the year's second half, averaging $750 million daily versus $960 million in the first, data from digital asset manager CoinShares showed on Monday.

Still, crypto investment products attracted $151 million in investments last week in their 13th consecutive week of inflows, and total product inflows for the year so far have hit a record $9 billion, according to CoinShares.

"It alludes to the fact that we're also not overheated at the 60K market. There's still a good way to go," Justin d'Anethan, institutional sales manager at crypto trading firm EQONEX wrote in a daily newsletter.


The wider Nasdaq crypto index, which tracks popular digital assets such as Litecoin, in addition to bitcoin and ether, was on track for weekly declines of 9.8%.

Among so-called "meme coins," dogecoin, created as a joke for early crypto adopters and which has surged over 4,000% this year, was up 2.5% at $0.23 on the day, according to CoinGecko, while recently popular Shiba Inu dropped about 17% over the past 7 days.

The total market capitalization of cryptocurrencies stood at $2.7 trillion as per CoinGecko, down from a peak of over $3 trillion.

Catch all the Latest Tech News, Mobile News, Laptop News, Gaming news, Wearables News , How To News, also keep up with us on Whatsapp channel,Twitter, Facebook, Google News, and Instagram. For our latest videos, subscribe to our YouTube channel.

First Published Date: 19 Nov, 23:39 IST