Suffering the effect of the current bloodbath in the crypto market, Bitcoin’s (BTC) price on May 12 hit its lowest valuation of $26,350 since December 2020. This bearish trend is strikingly similar to the mid-season bearish tendency that existed from May 2021 through June 2021.
In both market crashes, Bitcoin’s price broke the resistance level of $30,000. Recently, it had dropped more than it reversed back in June 2021 when the BTC’s valuation stopped losing at $29,800. However, the price of the BTC in current market clash is at $26,3000.
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In both cases, there were several macroeconomic factors that influenced the cryptocurrency market. For example, before 2021’s bearish trend, Chinese banks prevented using crypto by disallowing crypto services for the state’s financial sector. Elon Musk then added to the flames by reverseing his decision not to allow Bitcoin payments to Tesla. The COVID-19 distortion caused major countries to pull out of the blockchain industry. BTC prices plummeted accordingly.
Similar to the previous downturn, the fate and geopolitical factors have influenced Bitcoin’s future. In the beginning, there was the Russia/Ukraine conflict, which greatly affected crypto prices. Regulators imposed strict rules each day, at a moment when Bitcoin was growing globally. Bitcoin’s price plummeted further due to the Fed regulation and legal ambiguity of digital assets.
Bitcoin Holders Want To Leave Their Assets
Many crypto investors pulled their funds after the current slump. Others still own losses, but they expect that crypto prices will continue to rise in the future. According to stats16967 726 wallet addresses are currently losing money, breaking previous records. The 19th Mach 2020 peak in cryptocurrency history was similar.
Due to crypto market’s unusual behavior, investors were forced by it to liquidate all their investments and not take any losses. That’s why the figure for the following metric has decreased. The number of cryptocurrency traders who have 1K+ coins stored in their wallets is now at a record low of 2,234. This figure was also recorded May 11.
The May 11th transactions record was broken by crypto investors who rushed to get out of their Bitcoin investments. The traded volume has reached an all-time high of 175,146.8 BTC. This is a 4 year new record. Recent highs in committed transactions have been eclipsed by the recent record.
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Scott Melker (host of The Wolf of All Streets Podcast) discusses current crypto market conditions. Comment that “the entire market is reeling.”
He also added:
The markets seem to be in an irrational panic. Extreme fear has been the trend, just as it did in the past. People are forced to sell their assets near or at the bottom of this cycle.
Featured image taken from Pixabay. Chart from TradingView.com