The price of Bitcoin goes up and down from time to time, and it has ceased to amaze the traders.
But, recently, it has hit its lowest price point in 2022, and that has shocked the Crypto traders to a certain extent.
Since January 2022, Bitcoin’s market value has fallen to the lowest degree, and other digital tokens seem to follow suit.
If you’re a trader at Quantumai, you may have already been notified about this unexpected price decline. But, more than getting mere notifications, we should dive deep into its delve and find the reasons for such a shocking event.
So, without further ado, let’s begin.
Is The Bitcoin Market Down?
Since the Crypto market is deregulated, the unexpected market fluctuations will be fellow passengers in this journey.
If you want to reach the end of this path and make a profit, you must bear these fellow passengers no matter how much you hate them.
Bitcoin (BTC) shocked the world in July 2021, when its price value dropped to $31,000 for the first time in the year. The price fell even by an additional 11% in NYC, with a total round-up valuation of $30,339.
This intraday decline was indeed shocking for Bitcoin traders.
Recently, its price movement has shocked the traders once again. It has fallen to $30,000, which leaves the digital coin on the precipice of a key support system. Experts say a centralized regulation system may be better for predicting the price movements of BTC now and in the future.
This is the 3rd time in the last 12 months and the first time in 2022 that Bitcoin’s price has dropped so much.
For the many times in the past when Bitcoin’s price dropped so dramatically, it bounced back up in no time, assuring its traders of its inherent profit volume. However, the price never fell as low as $30,000, which is why things seem tough at the moment for BTC to bounce back.
Are Other Coins Following The Same Path?
Not only Bitcoin but also the prices of Ethereum and Solana have also ripped in this financial decline.
The overall Crypto market is now worth $1.5 trillion, which is down by more than half its valuation since last November.
ETH’s price has been dropping gradually since Monday. Its current trading volume is $2300, which is 18% down from last week. Even though BTC did not drop so drastically, it looks like other Cryptocurrencies are following the same path.
However, things look rather bleak for Solana. While ETH and BTC prices have been falling since last week, the price of Solana has been falling for the past 6 months.
In November 2021, Solana’s price was $258.93, but since then, it has not noticed any gradual improvement. For more than half a year now, Solana’s price has been declining, and its current trading volume is $81.31.
Apart from these, Terra’s price dropped 6%, Avalanche dropped by 5%, and Shiba Inu dropped by 4%. It has made the global Cryptocurrency market capital fall by 3% in the last 24 hours.
On the other hand, these dynamic price falls have made the overall Cryptocurrency trading volume stand at $98.63 billion at the moment.
Why Did Bitcoin Prices Crash?
Since volatility is synonymous with Cryptocurrency crashes, there cannot be any particular reason responsible for this event.
However, experts still predict fear of potential recession and inflation as the reasons behind this crash.
The general equity market and Bitcoin price also share a fair correlation that seems rather unpleasant.
Statistics show that NASDAQ and S&P 500stock prices lowered by 0.91% and 0.885, respectively, when the Bitcoin price crashed. As investors try to grapple with the pressure of inflation, Bitcoin’s price movement, like the stock market, depends on it.
On top of that, the tight U.S Monetary policy has also been a reason behind this sudden crash.
It proves that despite the deregulation and decentralization of the Crypto world, they follow the economic trends, and their price values go up and down like the traditional stocks.
As you can see, the price drop of Bitcoin and other Cryptocurrencies has been pretty low, and they are not immune from the traditional economic volatilities.
You may consider their shortcomings as a drawback as many others, which is why the investment volume has plummeted in 2022.
But, things will soon change their trajectory, and Bitcoin, like other Cryptocurrencies, will bounce back in the game.
So, if you need further information on this, reach us in the comment section. We will get back to you with a reply shortly.