Coinbase's recent IPO has sent crypto-currencies into a tailspin, hitting new highs. However, with the volatility of the market, a further fall in prices seemed inevitable.
Last week was a rough one for Bitcoin (BTC). The leading cryptocurrency was in free fall, dropping from an all-time high of nearly $65,000 a few days ago to $49,730 on Friday, April 23. This is the first time since early March that BTC has traded below $50,000, and it has dragged down other digital currencies like Ethereum and XRP.
According to several specialist news sites, Friday's drop was due to the wave of selling seen after the announcement of US President Joe Biden's proposed capital gains tax increase.
It should be noted, however, that BTC had already begun its downward trend a few days earlier due to several unfavorable factors. These include an unverified rumor of money laundering prosecutions using cryptos led by the U.S. Treasury and a mining problem in China.
While over the weekend it went back up, starting the new week at around $52,000, the drop is a reminder of the very high volatility of the market that some investors seemed to forget, with the recent rally leading to the all-time high. Thus, according to some analysts, this dizzying fall is "normal", with BTC having to enter a correction phase proportional to its recent rise, catching its breath in order to better rebound in the long term.
"There are no signs right now that would suggest this is the beginning of the end. I believe that Bitcoin has many good years ahead of it," commented Martin Lalonde, president of Rivemont, a Canadian fund manager, quoted by Le Devoir.
Source: Website
Post a Comment