Analyst Who Nailed May 2021 Bitcoin Crash Says BTC Looks Bullish With Plenty of Wiggle Room Despite Pullback
The crypto strategist who accurately called Bitcoin’s 2021 collapse says BTC remains bullish despite correcting over 15% in about a week.
The pseudonymous analyst known in the industry as Dave the Wave tells his 124,000 Twitter followers that Bitcoin may be mirroring its 2018 bottom where it printed an ascending triangle pattern to crawl out of the bear market.
“You can measure the fractal with a real [Fibonacci]… or just use the comparative angle. Plenty of wiggle room while staying bullish on the macro.”
Source: Dave the Wave/Twitter
According to the crypto analyst, Bitcoin continues to respect key Fibonacci retracement levels amid the pullback.
“Currently a 50% retracement of the recent move up. And a 38% retracement of the macro.”
Source: Dave the Wave/Twitter
At time of writing, BTC is trading at $21,286, above Dave the Wave’s key Fibonacci area of $21,000.
Although Dave the Wave says BTC still looks bullish, fellow crypto analyst Smart Contracter does not share the same sentiment. The crypto strategist who accurately predicted the 2018 bear market bottom for Bitcoin believes BTC is poised to print a new cycle low.
“My god that was fast. Probably not interested in buying any BTC until it makes a new low below $17,000 now. That chart is ugly as hell.”
Source: Smart Contracter/Twitter
Expert Who Predicted Bitcoin Crash Predicts When It Will Bounce Back
In an explosive interview with Kitco News, Richard Heart, the founder of HEX, who predicted Bitcoin’s fall to $10K, revealed when Bitcoin is expected to bounce back. He also revealed how Bitcoin will perform under recession.
Richard Heart Calls Out Michael Saylor
The interview started with Heart calling out people who did not pay attention to his $10K BTC prediction and are in massive loss. He called out Michael Saylor, Three Arrow Capitals, and Celsius for taking leverage and believing in a BTC super cycle. He revealed that MicroStrategy, a company that Saylor owns, went down 90%. He also took shots at Coinbase for its shares going down 90%.
According to Heart, BTC has traditionally always gone down by about 85%. According to him, investors like Saylor delayed the inevitable downfall to $10K, after which BTC would have bounced back up.
Heart Predicts Bitcoin Bounce Back Scenario
In a response to a question regarding Bitcoin’s performance during a recession, Heart revealed that he expects crypto to do well during the recession. According to him, crypto is strongly correlated to stocks, which will perform well when the Federal Reserves start cutting down taxes.
Many experts believe that with the back-to-back negative GDP growth, another unusual interest rate hike by the Fed is unlikely. According to Heart, at some point, the Fed will get back to printing money again and the risk asset classes like crypto will bounce back.
Heart believes that volatility is a price to pay in crypto, which he believes to be the best performing asset in the world. Citing the example of Amazon’s price crash in 2000, he revealed that every asset with high potential has volatility as its side effect.
In response to a question about whether crypto can outperform stocks during the upcoming recession, Heart answered in the affirmative. According to him, while some stocks did perform well in the last recession, crypto has the potential to outperform the stock market.
The search term ‘Bitcoin Crash’ is trending — Here’s why
Last year, the word “crypto” was trending all over the internet as the crypto market was generally flourishing.
However, now it appears that the good fortunes of digital coins havee waned as cryptos have slipped into a serious bear market. Bloomberg recently reported that while the short-term investors wasted no time in dumping their holdings, even the old-timers are now exiting the scene.
The most recent Bitcoin (BTC) crash saw the asset’s price go as low as $17,000, its lowest price since late 2020. Reflecting the general air of uncertainty among investors in the cryptocurrency market, “Bitcoin is Dead” is beginning to trend once again, at least, according to the data from Google Trends.
But, while downturns may generally be a part of crypto markets, things continue to look bleak for crypto.
What triggered the latest Bitcoin crash?
Bitcoin has slipped nearly 70% from its November record high, but it all started in March when CNBC reported that the Federal Reserve approved its first rate hike in three years. That singular act went on to be a major turning point, putting downward pressure on risk assets like Bitcoin. Meanwhile, a series of other events soon followed that also impacted the crash of Bitcoin, including Russia’s invasion of Ukraine and the Terra crash.
Rob Schmitt, chief operating officer of infrastructure provider Toucan, told Cointelegraph:
“A combination of macro headwinds, such as increased interest rates and geopolitical uncertainty, has triggered a broader market downturn that has caused a major delegating event in crypto markets. Specifically, the implosion of Terra and the following insolvency/deleveraging of Celsius and Three Arrows Capital, has forced the liquidation of large amounts of BTC, which caused a price crash.”
First Digital global digital payments firm CEO Vincent Chok insisted on the Luna Classic (LUNC) collapse being the major cause of the crash. He told Cointelegraph:
“This is a part of the normal market cycle. The primary trigger was not geopolitical conflict, but the LUNC collapse and the systemic risks associated with the large exposure to this token.”
The collapse triggered margin calls for hedge funds and defined liquidity positions. Chok added that it’s part of the super cycle of the industry, an evitability of the bull run. Something had to be corrected sooner or later, he added.
Crypto will survive
Bitcoin has been written off as dead at least 458 times in the past. But each of those times, it has managed to come back to life.
Kevin Owocki, founder of Gitcoin DAO — a platform for funding open source Web3 projects — told Cointelegraph:
“Bitcoin has been declared dead hundreds of times in the past and, so far, these commentaries have always been wrong. If the past is any guide, Bitcoin is not dead. I don’t want to get into price forecasts, but my focus has always been on the future of what Web3 can build and how those tools can provide solutions to global problems that humanity faces.”
“We have been through ‘winters’ before where the value of digital assets dropped to uncomfortable levels, but we have seen that the greater crypto community emerges from these periods stronger and more resilient than before. I believe that we will get through this and on the other side the products and assets that have survived will be value generators not just for Web3, but beyond,” Owocki added.
Furthermore, Schmitt also claimed that “a temporary drop in its price does not significantly impact Bitcoin.” He explained how Bitcoin has had to go through multiple larger drops in the past.
Recent: Tether fortifies its reserves: Will it silence critics, mollify investors?
Several other on-chain metrics suggest that Bitcoin will most likely come out of its current situation. One such important metric is the 200-weekly moving average (WMA).
For a long time, the moving average has been a credible indicator of BTC price. Previously, at every point that Bitcoin has hit the 200 WMA, it completely bounced back. A careful look at what happened between 2015 and 2020 in the chart below gives insight into this claim.
Graph showing how Bitcoin surged each time it hit the 200-WMA. Source: TradingView
There are times that Bitcoin dipped slightly below the 200-WMA, but it never stayed there for too long.
So, seeing as Bitcoin is currently trading at a very close range to its 200-WMA, there may be a reason to believe that Bitcoin is not dead. In fact, an upward swing is justifiably expected soon.
The impact of crypto on the economy
Institutional involvement in the crypto market’s last bull cycle has sparked fears that the broader economy may potentially be affected.
Many companies have had to lay off a sizeable number of their employees, and others are looking at potential insolvency. Additionally, a recent Pew Research Center survey found that around 16% of U.S. adults have in one way or another been involved with cryptocurrency. So to an extent, there is a certain amount of national exposure to the current situation of the crypto market.
However, not everyone believes that the crypto market situation will impact the broader economy. In an interview with CNBC, Joshua Gans, an economist at the University of Toronto, said:
“People don’t really use crypto as collateral for real-world debts. Without that, this is just a lot of paper losses. So this is low on the list of issues for the economy.”
Despite the bleak outlook for the crypto market at the moment, crypto continues to see massive adoption across the board. With increased involvement from sports organizations, private individuals, corporate institutions and even states and federal governments, there is a clear trend of crypto adoption.
According to United States-based news outlet Axios, crypto app downloads are improving on a yearly basis, and that should be attributed to higher media coverage. While there was a 64% growth in 2020, last year saw an even more impressive 400% spike in the number of crypto apps downloaded.
Crypto deals with sports brands, teams and leagues increased by more than 100% in 2021 and are expected to reach $5 billion in the next four years.
How long until BTC bounces back?
Going by past trends in the crypto market, the present situation may take weeks, months, or possibly years to reverse, and while the Bitcoin price is suffering at the moment, that should not take away the fact that it is still up 31,437% over the last nine years. In fact, it was currently more than double its price two years ago. Owocki said:
“At Gitcoin Holdings, we know that it may take some time for the general market to recover — but we do not know exactly how long or which assets will recover. It could be five weeks, it could be five years. We are focused on creating value for the long term.”
While there is no exact timeframe as to when Bitcoin will resume an uptrend, it certainly seems that a temporary price drop will ultimately not impact the rapid growth of usage, adoption and prices of crypto assets in the long run.
Owocki believes that the evolution of the internet can be viewed through the lens of the evolution of nature. Instead of natural selection, “we have a market selection.” He said that there was a “Cambrian explosion” of opportunity created by the launch of Bitcoin and multiple forks of BTC.
Recent: A brief history of Bitcoin crashes and bear markets: 2009–2022
Then Ethereum arrived, and a rich ecosystem of layer-2s, decentralized finance, nonfungible tokens, crowdfunding tools, decentralized autonomous organizations and alternate layer-1 networks.
“As this Cambrian explosion works its way through cycles of greed and fear, projects grow and die, and through it, all the heartbeat of innovation continues to pulse. I can’t wait to speed run this evolution until we get to the Web3-equivalent of keystone species like dolphins, humans, forests, or mycelial networks,” Owocki added.
The Gitcoin DAO founder doesn’t think that the BTC or crypto crash is big enough to kill an economy. Throughout history, Owocki added, there have always been bear markets and bull markets. He says that Web3 will emerge on the other side of this stronger, and will contribute even greater value to the world economy than ever before.
A brief history of Bitcoin crashes and bear markets: 2009–2022
Bitcoin (BTC) experienced one of its most brutal crashes ever in 2022, with the BTC price plummeting below $20,000 in June after peaking at $68,000 in 2021.
June 2022 has become the worst month for Bitcoin since September 2011, as its monthly losses mounted to 40%. The cryptocurrency also posted its heaviest quarterly losses in 11 years.
However, the current market sell-off doesn’t make Bitcoin crashes and bear markets exclusive to 2022. In fact, Bitcoin has survived its fair share of crypto winters since the first Bitcoin block, or the genesis block, was mined back in January 2009.
As we zoom out the Bitcoin price chart, Cointelegraph has picked up five of the most notable price declines in the history of the seminal cryptocurrency.
Bear market No. 1: Bitcoin crash from $32 to $0.01 in 2011
Time to retest previous high: 20 months (June 2011–February 2013)
The Bitcoin price broke its first major psychological mark of $1.00 back in late April 2011 to start its first-ever rally to hit $32 on June 8, 2011. But, the joy didn’t last long, as Bitcoin subsequently plummeted in value to bottom at just $0.01 over the course of a few days.
The sharp sell-off was largely attributed to security issues at the now-defunct Mt. Gox, a Japanese crypto exchange that traded the majority of Bitcoin at the time. The exchange saw 850,000 BTC stolen due to a security breach on its platform, raising major concerns about the security of Bitcoin stored on exchanges.
With BTC losing about 99% of its value in a few days, Bitcoin’s June 2011 flash crash became a big part of Bitcoin history. The event opened a long period before the BTC price recovered to the previous high of $32 and climbed to new highs only in February 2013.
Haha nice #bitcoin crash to 0.01 USD/BTC. http://t.co/jNx8rAr
— Who Knows? ₿⚡️ (@who_knows) June 19, 2011
It’s difficult to track the pre-2013 Bitcoin price when compared to more recent charts. Popular price tracking services and sites like CoinGecko or CoinMarketCap do not track Bitcoin prices before April 2013.
“Bitcoin was very much in its infancy pre-2013 and there were not that many places trading Bitcoin back then,” CoinGecko chief operating officer Bobby Ong told Cointelegraph. He added that CoinGecko has not received many requests for pre-2013 data, so it is low on the priority for the platform.
Bear market No. 2: Bitcoin tanks from $1,000 to below $200 in 2015
Time to retest previous high: 37 months (November 2013–January 2017)
According to BTC price data collected by Cointelegraph, Bitcoin price reached $100 in mid-April 2013 and then continued surging to briefly hit $1,000 in November 2013.
Bitcoin entered a massive bear market shortly after breaking $1,000 for the first time in history, with the BTC price tumbling below $700 one month later. The price drop came as the Chinese central bank began to crack down on Bitcoin in late 2013, prohibiting local financial institutions from handling BTC transactions.
The cryptocurrency continued plummeting over the next two years, bottoming at around $360 in April 2014 and then dropping even further to hit a low of $170 in January 2015.
Bitcoin price chart April 2013–January 2017. Source: CoinGecko
The long cryptocurrency winter of 2014 became associated with the hacked Mt. Gox crypto exchange, which halted all Bitcoin withdrawals in early February 2014. The platform then suspended all trading and eventually filed for bankruptcy in Tokyo and in the United States.
Some major financial authorities also raised concerns about Bitcoin, with the U.S. Commodity Futures Trading Commission claiming that it had power over “Bitcoin price manipulation” in late 2014.
The general sentiment around Bitcoin was mainly negative until August 2015, when the trend started a long-term reversal. Amid the strong bullish market, Bitcoin eventually returned to the $1,000 price mark in January 2017. This was the longest all-time high price recovery period in the history of Bitcoin.
Bear market No. 3: Bitcoin plunges below $3,200 after hitting $20,000 in December 2017
Time to retest previous high: 36 months (December 2017–December 2020)
After recovery to $1,000 in January 2017, Bitcoin continued to rally to as high as $20,000 by the end of that year.
However, similar to Bitcoin’s previous historical peak of $1,000, the triumph of $20,000 was short-lived, as Bitcoin subsequently dropped and lost more than 60% of its value in a couple of months.
The year 2018 quickly became referred to as a “crypto winter” as the Bitcoin market continued shrinking, with BTC bottoming at around $3,200 in December 2018.
The crypto winter kicked off with security issues on Coincheck, another Japanese cryptocurrency exchange. In January 2018, Coincheck suffered a gigantic hack resulting in a loss of about $530 million of the NEM (XEM) cryptocurrency.
The bear market further escalated as tech giants like Facebook and Google banned ads for initial coin offerings and token sales ads on their platforms in March and June 2018, respectively.
Global crypto regulation efforts contributed to the bear market as well, with the U.S. Securities and Exchange Commission rejecting applications for BTC exchange-traded funds.
Bitcoin price chart December 2017–December 2020. Source: CoinGecko
Bear market No. 4: BTC slumps from $63,000 to $29,000 in 2021
Time to retest previous high: six months (April 2021–October 2021)
Bearish sentiment dominated the crypto market until 2020, when Bitcoin not only came back to $20,000 but entered a massive bull run, topping at higher than $63,000 in April 2021.
Despite 2021 becoming one of the biggest years for Bitcoin, with the cryptocurrency passing a $1 trillion market cap, Bitcoin also suffered a slight drawback.
Shortly after breaking new all-time highs in mid-April, Bitcoin drew back slightly, with its price eventually dropping to as low as $29,000 in three months.
The mini bear market of 2021 came amid a growing media narrative suggesting that Bitcoin mining has a problem related to environmental, social and corporate governance (ESG).
The global ESG-related FUD around Bitcoin had been exacerbated even further with Elon Musk’s electric car firm Tesla dropping Bitcoin as payment in May, with the CEO citing ESG concerns. Just three months later, Musk admitted that about 50% of Bitcoin mining was powered by renewable energy.
The cycle of FUD pic.twitter.com/OC8kGXAUSd
— Lina Seiche (@LinaSeiche) June 20, 2021
The bear market didn’t last long despite China starting a major crackdown on local mining farms. The bullish trend returned by the end of July, with Bitcoin eventually surging to its still-unbroken all-time high of $68,000 posted in November 2021.
Bear market No. 5: Bitcoin plummets from $68,000 to below $20,000 in 2022
Time to retest previous high: to be determined
Bitcoin failed to break $70,000 and started dropping in late 2021. The cryptocurrency has slipped into a bear market since November last year, recording one of its biggest historical crashes in 2022.
In June, the cryptocurrency plunged below $20,000 for the first time since 2020, fueling extreme fear on the market.
The ongoing bear market is largely attributed to the crisis of algorithmic stablecoins — namely the TerraUSD Classic (USTC) stablecoin — which are designed to support a stable 1:1 peg with the U.S. dollar through blockchain algorithms rather than equivalent cash reserves.
USTC, once a major algorithmic stablecoin, lost its dollar peg in May. The depegging of USTC triggered a massive panic over broader crypto markets as the stablecoin had managed to become the third-largest stablecoin in existence before collapsing.
The collapse of Terra caused a domino effect on the rest of the crypto market due to massive liquidations and uncertainty that fuelled a crisis in cryptocurrency lending. A number of global crypto lenders like Celsius had to suspend withdrawals due to their inability to maintain liquidity amid brutal market conditions.
Bitcoin has historically seen its price trade below previous highs for more than three years. The previous peak of $68,000 took place just seven months ago, and it’s yet to be seen whether and when Bitcoin would return to new heights.
The Bitcoin Crash Provided a Rare Glimpse inside the Heart of the Crypto Industry
The aftershock of Bitcoin’s heavy selling provided a glimpse into how different companies reacted to the market volatility. Following numerous predictions for imminent selling in Bitcoin and Ethereum, BTC nosedived to around $19,000.
The panic that gripped the cryptocurrency markets provided some interesting insights into the industry.
It has been estimated that in order for bitcoin miners to remain profitable, Bitcoin must trade at $21,000 the very least. As the price broke below $20,000 not long ago, there was an effort by key figures in the financial sector (such as Bank of England Governor Andrew Bailey) to intensify the selling.
The majority of central banks are against cryptocurrencies in their current form. They are nevertheless appreciate the blockchain technology and CBDCs (Central Bank Digital Currency) are being tested.
It was recently announced that the Bank of Israel is testing CBDCs with Hong Kong’s central bank. The project will be in the form of a two-tiered system, scheduled to begin in Q3 2022.
The panic that gripped several firms in industry is truly mind blowing.
Bitcoin Miners Panic
Due to the large drop in Bitcoin, BTC miners decided to scale bank on their operations. One of the indicators that reflects reduced activity from bitcoin miners is BTC hash rate.
The most recent decline in Bitcoin’s hash rate displays how bitcoin miners cut back o their operations. GPU prices were also slashed due to the bear crypto market.
Tom’sHardware reported the RTX 3080 that was sold for at least $1,000 is listed in eBany for less than $650. Different sellers listed four RTX 3080s for $2,500, approximately $418 for each one.
Bitcoin miners that experienced a drop in their mining income began panicking and tried salvaging their investment by selling their equipment as soon as possible.
There may be some correlation between GPU prices and the crypto markets as GPU powers up the blockchain. The correlation may become thinner over time as crypto markets continue to evolve.
Jaime Leverton, chief executive of Hut 8 said: “Companies that have been thoughtfully planning for the downturn for some time are likely to weather this period, but many have acted with impulse at the height of the market, and may be stretched and underfunded in the coming months.”
Hut 8 Mining Corp. is among the top biggest crypto miners in the industry, focusing on Bitcoin and Ethereum. Hut 8 set aside 7,078 BTC according to some reports that may be used for acquisitions.
Some are expecting takeover deals to take place within the year.
Bitfarms Liquidated Almost 50% Of Its BTC
Bitfarms released a statement on its website that it sold almost 50% of its BTC holdings (3,000 Bitcoin for approximately $62 million). Jeff Lucas, CFO of Bitfarms said: “In consideration of extreme volatility in the markets, we have continued to take action to enhance liquidity and to de-leverage and strengthen our balance sheet.
“Specifically, we sold 1,500 more Bitcoin and are no longer HODLing all our daily BTC production.
“While we remain bullish on long-term BTC price appreciation, this strategic change enables us to focus on our top priorities of maintaining our world-class mining operations and continuing to grow our business in anticipation of improved mining economics.
“Since January 2021, we have been funding operations and growth through various financing measures. We believe that selling a portion of our BTC holdings and daily production as a source of liquidity is the best and least expensive method in the current market environment.”
It is worth adding that Bitfarms used some of the capital from liquidating BTC to pay Galaxy Digital for the $100 million (approx.) loan it took.
‘A substantial decrease in Bitcoin price may result in the Company being unable to meet the minimum Bitcoin collateral requirements, which could result in the disposition of the Company’s Bitcoin pledged as collateral by the Facility Lender, or repayment of the facility in fiat currency on demand.’
Google Organic Search for Bitcoin Spikes
As organic search for Bitcoin has been dwindling over the past couple of months, the crypto crash injected renewed interest in Bitcoin. Organic search for ‘Bitcoin’ reached 100/100 on google trends.
source: google trends
El Salvador, Netherlands, Nigeria, Switzerland, Austria and Turkey are among the top countries that searched for Bitcoin. Organic search tends to increase during firm price movements.
In this instance, investors may experience Fear of Missing Out (FOMO) due to BTC and ETH rebounding off their lows.
Crypto Winter, Job Layoffs
The fear of a chilly crypto winter made several crypto exchanges to act as a precaution. Coinbase announced that will cut 18% of its global workforce, which is approximately 1,100 jobs.
The crypto exchange is expected to have around 5,000 employees by the end of June 2022. Coinbase also reported it saw a decline of 19% in its active monthly users in Q1 2022 due to a rapid decline in cryptocurrencies’ prices.
Vauld, a cryptocurrency exchange backed by Coinbase in Singapore announced it is cutting its workforce by 30%. Most of Valud’s employees are based in India. Darshan Bathija, Co-Founder and CEO at Vauld wrote a post in the company’s blog that ‘Vauld continues to operate as usual despite volatile market conditions.’
Bathija also highlighted that the exchange has no exposure to Celsius or Three Arrows Capital and ‘all withdrawals were processed as usual and this will continue to be the case in the future.’
Valud will also reduce marketing expenses and halve executive compensation. Gemini is also skimming 10% of its employees, Crypto.com to cut 5% of workforce.
Bitcoin trading volumes are up on multiple exchanges including Kraken and Bitstamp. While some may argue that these are Bitcoin short liquidations, volumes remain firm during BTC bullish rebound (at the time of this writing).
Ether is also enjoying strong volumes across the exchanges. The layoffs may be related to recession fears in the US. Many companies (not related to cryptocurrencies / tokens) had reduced their staff.
During the 2008 Lehman Brothers crisis many turned to trading / investing in various financial products. Extraordinary volatility often unveils opportunities.
Although the cryptocurrency markets are still relatively new compared to stocks or forex, a similar concept may be applied.
Binance and Lbank affirmed that they are continuing to hire, ‘against the trend’ of reducing staff ahead of a potential recession. The effects of these announcements reassure investors that the exchanges are well-financed and are positioned to tackle hurdles that may occur.
It may also draw talent to these exchanges as opposed to others. It will be unsurprising if executive figures will depart from Coinbase and Gemini to join Binance or Lbank.
Crypto Ads Spending Cut
Following Bitcoin price drop from over $60,000 to $20,000 (approx.), crypto exchanges have dialed down their marketing spending. The Wallstreet Journal (WSJ) estimated that spending was cut by over 90% by the top crypto companies (including TV ads).
Crypto.com spending in May was $2.1 million compared to $15 million in November 2021. Gemini spending dropped to $478,000 in May from $3.8 compared to $3.8 million in November.
However, not all companies have trimmed their marketing budget. FTX estimated to have spent $5 million in May compared to $3 million in November.
It is quite surprising to see significant spending cuts. Bitcoin is appears to be presented as a ‘winning horse’ that only gains attraction when it ‘wins.’ When the horse is short of breath and underperforms, it is deemed as an unattractive.
The majority of investors are aware that a dip in a highly-valued asset may be an opportunity, which is backed by large BTC holders netflow.
It may be possible that well-capitalized companies are not slicing their spending budget. As long as the market remains volatile traders are likely to participate. However, when the price is held in a tight range, some may prefer to stake their holdings.
The Next ‘Hot’ Sector and Conclusions
Bitcoin miners need to learn from oil rigs companies how to act and prepare for price fluctuations. Hiring during a bear market may demonstrate the financial strength and stability of the company.
Interest in cryptocurrencies is highly correlated to price fluctuations. The next dominant sector that may rise over time in my opinion is the metaverse or more accurately metaverse real estate.
As the top cryptocurrencies weakened significantly, bargain hunters may attempt to increase their exposure to virtual real estate market.
source: google trends
Trading volumes are still firm despite the ‘crypto crash.’ In an event the US enters recession at the end of the year, Bitcoin may ‘de-peg’ from the US markets and claim a safe-haven status.
Hiring during a bear market may signal the strength of the company in its ability to withstand extreme market conditions. Chopping the marketing budget in a phase that may attract more traders/investors into the crypto markets may not achieve its goals.
The new GBP stablecoin may be available as soon as July.
Acquisitions may blossom. Gripped by panic, companies may offer their project for sale at a fairly competitive price. Uniswap Labs, a popular decentralized exchange (DEX) recently acquired Genie, an NFT marketplace aggregator. The size of the acquisition is undisclosed at the time of this writing.
USD trading volumes for NFT purchases dropped by more than 66 percent in the past 30 days. It increases the odds Genie was acquired at an attractive price should NFT volumes surge over the next 12 months.
The next major event aside central banks is the ETH merge (due in August) and ADA hard fork (postponed to the last week July). Tether announcing a new stablecoin that is pegged to GBP may also contribute to ETH as it will initially be available on the ETH Mainnet.
Gold Proves To Be A Safe Haven Asset Amid Bitcoin Crash
The advantages of holding bitcoin over gold have been publicized and debated countless times. These two digital assets, one a physical asset and the other referred to as the “digital gold”, have both gone head-to-head when it comes to which one is the better store of value. As the bitcoin crash raged on last week, the discussion is once again being had about the merits of holding a relatively stable asset such as gold compared to a volatile one such as bitcoin.
Gold Provides Cover
Over the past week, the price of bitcoin had declined more than 30%. This had led to a sea of red in the market as the rest of the cryptocurrencies followed suit. During this time, the year-to-date value of bitcoin had dumped significantly. This put the digital asset which had been outperforming its physical counterpart for quite a while behind it once more.
Despite the year-over-year returns of gold being gown, it remained in the positive while that of bitcoin has declined into the red. As of Tuesday, gold is up 0.6% year-to-date, putting it in the green territory. As for bitcoin, the cryptocurrency is now down a whopping 55% on a year-to-date basis.
The volatility of bitcoin has been a cause for concern for those in the traditional finance market. However, it has also been one of the biggest pulls for those invested in the asset. It had grown more than 50% last year to an all-time high of $69,000 before declining over the next six months to a low of $17,600.
BTC price trading below $21,000 | Source: BTCUSD on TradingView.com
While the sell-offs have rocked bitcoin, gold has not been as unfortunate. So when it comes to the argument of which of these digital assets serves as the better inflation hedge, gold has now come ahead of the cryptocurrency.
Bitcoin Going Down?
Bitcoin’s recovery streak has been encouraging over the past couple of days. After hitting a low in the $17,000 territory, the recovery has been steady ever since, save a few dips here and there. With this has come a recovery above the 5-day moving average for the first time in the last week.
Despite this, the selling pressure has remained high and more sell-offs are rocking the market. However, support is beginning to form above the $18,000.
There are also the implications of the price of the digital asset falling below the previous cycle high for the first time ever. It has given credence to the school of thought that the digital asset has not reached its bear market bottom. Coupled with the fact that bitcoin has previously fallen at least 80% in all its previous markets, the bottom is likely to come in at around $13,000.
Additionally, the bottom is expected to happen about 15 months after the previous halving which puts the bottom at some time in the 4th quarter of 2022.
Bitcoin is trading at $21,313 at the time of this writing. It is up 1.93% in the last 24 hours with a market cap of $405.8 billion.
Featured image from Kinesis Money, chart from TradingView.com
Crypto market melts $370 billion in a week as bears threaten Bitcoin crash under $20k
On June 15, Bitcoin (BTC) is trading only slightly higher than the critical $20,000 mark, as bears are threatening to push the flagship cryptocurrency down farther below the barrier, which might lead to the liquidation of the position of some major institutions.
The prices of several of the most prominent alternative cryptocurrencies, such as Ethereum (ETH), Cardano (ADA), and Dogecoin (DOGE), have increased by around 8% or more in the last day, although they are still down by 25% to 30% when compared to the values they had one week ago.
As a result of the market downturn, the global crypto market capitalization has seen an outflow of $369 billion in just seven days as the market cap fell from $1.247 trillion on June 8 to $878 billion on June 15, according to CoinMarketCap data.
Meanwhile, the market has shed $80 billion in just the last twenty-four hours alone as it continues its downward trend, while the trading volume has increased to $95,330,768,841 in the same time.
Bitcoin price analysis
Currently, Bitcoin is trading at $20,306, down 10.27% in the last 24 hours and a further 33.39% in the previous week alone.
In the last seven days, Bitcoin has seen $194 billion disappear from its market cap.
It is the most recent event in a string of price collapses for the cryptocurrency, which has seen its value fall by more than 60% in the space of seven months.
Institutions are feeling the pressure
Customers of the cryptocurrency lender Celsius have been informed that they would be temporarily unable to withdraw cash from the platform. This comes at a time when many holders of cryptocurrencies are selling up their holdings but also as Celsius adds more collateral amid the market sell-off to protect their Bitcoin from liquidation.
MicroStrategy also claims that it has not received a margin call in relation to its Bitcoin-backed loan and that it is able to weather further volatility and will ‘HODL through adversity’ in the cryptocurrency market.
After withdrawing employment offers earlier, cryptocurrency exchange Coinbase has revealed that it will lay off more than a thousand of its staff members.
Disclaimer: The content on this site should not be considered investment advice. Investing is speculative. When investing, your capital is at risk.
Bitcoin Crashed – Will Hit the Lowest of Lowest?
- The price fell under $ 25k, the $ 24900 low was met as the day started.
- The market cap also hit $ 479.29B with a volume to be $ 45 B.
The bear trend in the crypto market seems to be never-ending as of now. The previous week started with the green candle entry after the 10-week red march but that did not last long. The present week has already attained an 18-month low for BTC, the price touched support at $24900.
BTC Price Chart (Source: TradingView)
Last week’s trend changed on the second day itself and the weekend was hit by great US inflation. The current inflation rate is 8.58 % which is the highest since 1981, which was around 10.32%. The Consumer Price Index (CPI) has also skyrocketed, in 1981 it was 91.900 as of now it is 292.296.
The market capitalization has also decreased below $500 billion as of today, it touched $479.27B at 8.40 AM IST. At press time, the market cap is $488 B and the price is $25606.51. That is comparatively 6.59% low from the past 24hrs. The volume in the last 24 hrs is $45 billion.
BTC Market Cap (Source: CMC)
In the mid of May, Robert Kiyosaki stated that he is waiting for the crash of BTC below $17K to $11K, to back it up. But today’s crash didn’t seem to have impressed him. The response to the current crash was a mockery tweet, to invest in food.
Best INVESTMENT: Cans of Tuna Fish. Inflation about to take off. Best investments are cans of tuna & baked beans. You can’t eat gold, silver, or Bitcoin. You can eat cans of tuna and baked beans. Food most important. Starvation next problem. Invest in the solution. Take care.
— therealkiyosaki (@theRealKiyosaki) June 13, 2022
Trader Who Accurately Called Epic Bitcoin Crash Issues New Warning for Ethereum Investors
A veteran trader who became a legend in crypto circles after nailing Bitcoin’s (BTC) collapse in 2018 is sounding the alarm on leading smart contract platform Ethereum (ETH).
Peter Brandt tells his 645,700 Twitter followers that Ethereum is forming a descending triangle, a continuation pattern that suggest further downside risk for ETH.
“Not ready to dive head first into your crazy NFT [non-fungible token] world, but ETH looks like a good prospect for a measured risk short trade… ETH is a piece of c**p crypto. Transactionally cost-prohibitive and cumbersome. Those who tout new versions are still waiting for a re-build of the Hindenburg.“
Source: Peter Brandt/Twitter
Looking at the trader’s chart, the bearish pattern might play out if Ethereum takes out support at around $1,750.
Brandt is not the only popular analyst who’s bearish on Ethereum. Crypto strategist Cantering Clark also tells his 134,600 Twitter followers that ETH looks ripe for a sharp leg down as it now trades way below its diagonal support that has kept the market bullish since March 2021.
“If I didn’t think that this time was slightly different, I would look at this ETH chart and think, ‘Big ships turn slowly, and they don’t stop easily.’ By high timeframe measures, this could be the beginning of actual momentum down.”
Source: Cantering Clark/Twitter
Meanwhile, fellow crypto strategist Credible is looking at the performance of ETH against Bitcoin (ETH/BTC). According to Credible, the ETH/BTC pair appears poised to lose over 41% of its value from its current price of 0.060 BTC worth $1,785.
“ETH/BTC continues to bleed and is almost at my target first outlined four months ago. That being said, BTC hasn’t even started its fifth wave yet, meaning I expect ETH/BTC to go a lot lower as BTC leads the market out of this correction into its major fifth. Revised target below.”
Credible is a staunch Bitcoin bull who believes BTC will print a new all-time high this year (fifth wave), outperforming most altcoins during the initial stages of the rally.
At time of writing, ETH is changing hands for $1,796 while BTC is valued at $29,819.
MicroStrategy Goes Underwater In Latest Bitcoin Crash
- The largest corporate bitcoin holder is on the red.
- Bitcoin dipped to $30,330 on Monday.
- MicroStrategy paid an average of $30,700 for each bitcoin it holds.
The largest corporate holder of bitcoin, MicroStrategy, was at a loss as bitcoin dipped below its average purchase price of $30,700 on Monday.
The bitcoin price hasn’t had a good performance in the past few weeks, dropping as much as 20% in just 36 days since the end of its latest relief rally in late March. But over the past few days BTC has extended its losses as it plunged an additional 19.47% today, closing in on $30,000.
The red candle on the BTC/USD chart led MicroStrategy underwater as the Nasdaq-traded company saw the price dip below $30,700 – the amount it paid on average for all of its more than 129,000 bitcoin. Bitcoin fell as low as $30,331 on Monday, according to TradingView data.
MicroStrategy last purchased bitcoin in early April funded with a bitcoin-backed loan. The software analytics company acquired 4,167 BTC at the time for roughly $190.5 million at an average price of about $45,714 per bitcoin. However, due to the nature of the loan, the company risks getting margin called if the price drops below $21,000. MicroStrategy can avoid getting margin called and having to sell some of the bitcoin backing the loan by depositing more BTC as collateral.
Tesla is also at a loss, but has been for a longer period of time than MicroStrategy as its average purchase price is slightly higher. Tesla acquired 43,200 BTC last year for $1.5 billion, according to data from BitcoinTreasuries.net. The electric car maker’s cost per bitcoin sits at roughly $34,700, leaving the company with a nearly 10% unrealized loss at press time – about $155,000,000.
It is unclear how public companies will deal with a situation where their bitcoin holdings face a loss for a sustained period of time.