A major event has occurred in cryptocurrency. The biggest and most popular coin Bitcoin is going through a rough patch. At the time of writing, Bitcoin is down 1.41% at $21,427.36, according to BTC price chart, and seems to be in a downward direction. Whether the coin can recover will become clear over time. This isn’t the first time the coin has crashed, and it won’t be the last – although the low point of each crash may be higher than the last. In the past, many factors have caused it to go into a downward trend, and it has returned with varying degrees of success.
So, what brought about this new disaster on the night of August 18?Th? We’re digging into the record-breaking decline and what it means for the market.
So what happened?
Friday, August 18Th, Bitcoin fell to record-breaking lows, plunging to its lowest value in more than three weeks. The result was less than $22k at 2.30am on August 19th.ThThere was a sudden rush to sell crypto in the early European markets. Before 2:30 am, the coin continued to fluctuate between $21,500 and $22,000.
This is the latest in a series of dips for Bitcoin. In the year The coin has been slowly falling in value over the past nine months from a high of over $67,000 in November 2021. Relative stability prevailed around February and March, peaking at $46,000.
However, Bitcoin has been rising and looking promising for investors as it topped $25,000 for the first time since June due to a rise in US stocks.
In the end, the answer to this question is not easy. There is no clear answer, and it gets even more curious when you look at Binance Coin, Cardano and Solana. There are theories that we will list below.
Commentators suggest that the risk may be due to lower stocks in the US market. US markets will be on the lookout after the release of the minutes of the July US Federal Reserve meeting, which contained many points, but the US Federal Reserve may not be done with its rate hike until inflation stabilizes. Down. No guidance has been provided on the previously suggested rate hike, so people will think they are pulling their money in crypto coins until inflation stabilizes.
This makes sense because of crypto’s strong correlation with US stocks, but not in terms of timing. If crypto investors panic about what happened in July, will they all pull their money at the same time in mid-August?
Commenters seem to think that the amount of information that is happening is decreasing, especially in traditional crypto information channels and information sharing sites such as Reddit.
A big sales pitch?
Suzanne Streater, senior investment and market analyst at Hargreaves Lanestown, suggests a large sell-off transaction instead of an option. Because she didn’t see the quick recovery she expected, she told CNBC she doesn’t think the crash followed your average crash pattern. Instead, Bitcoin simply sank further in the early hours of August 19thTh. According to Streeter, instead, a large sell-off caused the crash, which saw a crash first in Cardano and then Bitcoin and Ether in smaller coins like Dogecoin.
Finally, she pointed out doubts about the continuation of the crypto market winter and said that this is the result of volatility in the market.
Is Asia involved in this?
according to Bloomberg, the biggest loss of the day came at the same time during Asian trading hours. To be precise, Bitcoin lost 5% of its value in Singapore just before 2.45pm. These mini-crashes are rare but common in most cryptocurrencies, so the theory is that US markets saw the mini-crash and pulled their money before things escalated, turning a small crash into a big crash.
So why the mini-crash? Well, Bloomberg points to the moments from the US Federal Reserve meeting and their proposal for higher interest rates as a factor in inflation on August 18.Th Crash. Perhaps the Asian market’s own mini-crash is just a fluke, and even spurs investors in cryptocurrencies into action. Perhaps the mini-crash combined with ever-increasing inflation was enough to convince investors to pull out now.
There seems to be a “wait and see” approach being taken by cryptocurrency these days. It seems that investors are currently waiting to see if Bitcoin will recover from August 26ThAnd the advice from the US Federal Reserve is to wait and see. Fed Chairman Jerome Powell told Bloomberg that investors will have to see how much appetite the market has for Bitcoin given specific market and economic conditions.