The cryptocurrency market does not seem to have bottomed and some analysts estimate that there is still a long way to go, market capitalization has fallen below the $1 trillion mark and is dragging Bitcoin towards levels not seen since December 2020. What awaits Bitcoin in the coming days?
Today we will be doing an analysis of the possible causes that have caused this catastrophe in the market and we will show you the possible objectives of Bitcoin according to analysts specialized in the study of the cryptographic market.
The latest events have caused a wave of distrust on the part of investors and the increase in uncertainty in the market has caused a fall from $30 thousand dollars.
The high rate of inflation in some of the world’s most powerful economies has kept investors on their toes and the imbalance shown by some platforms such as Celsius or Terra plus the closure of deposits by Binance has caused people to seek shelter in other assets.
“Bitcoin fell to its lowest level since December 2020 on Monday as the market continued to fall with a rise in selling price over the weekend, following rising inflation in the US. BTC is down more than 49% since the beginning of the year and 66% from its all-time high of $68,990 in 2021. If the sellers are determined, BTC may also drop to $20,000.”
Founder of the crypto investment platform Mudrex
The downtrend in the crypto market has been strongly influenced by currently rampant inflation and the US Federal Reserve is expected to raise interest rates this week to control the imminent increase in prices. Last week the US indices were sold off strongly and history shows that when this happens the cryptocurrencies also show a drop.
Likewise, to add fuel to the Celsius fire, the cryptocurrency lending platform froze its operations pausing all withdrawals, internal exchanges and transfers between accounts “due to extreme market conditions” blocking up to $12 billion dollars from its users and generating great mistrust in the market.
Other important events
The recently launched stablecoin native to the Tron network, USD (USDD), has lost parity with the US dollar.
Cryptocurrency exchange Crypto.com and lending platform BlockFi plan to cut a total of more than 400 jobs, joining an expanding list of crypto companies looking to cut staff.
The transition of the Ethereum network to Proof-Of-Stake (PoS) consensus has been delayed once again and should finally see the light of day in Q3 2022.
Vijay Ayyar, vice president of corporate development at Luno, noted that in previous bear markets, bitcoin had fallen about 80% from its last record. Currently, it is down around 63% from its last all-time high which it hit in November.
“All of this points to the market not fully bottoming out and unless the Fed can take a breather, we probably won’t see a comeback higher. We could see much lower bitcoin prices over the next month or two.”
Vice President of Corporate Development at Luno