The price of bitcoin is down more than 25 percent from an all-time high of nearly $20,000 reached this past weekend, market data shows.
Already, bitcoin has beaten its recent price weakness of 10 December, and news isn’t helping. Mempool congestion, internal politics, higher transaction fees, another exchange bankrupt, and charges of insider trading among one of the more popular US platforms, might be forcing weaker hands to sell.
At press time, average exchange quotes focused around $14,000, representing a slight recovery for the sub-$13,000 lows earlier today which lasted only briefly.
Despite the large numbers involved, Bitcoin’s latest downturn is, in fact, milder than those seen both this year and further back, when corrections up to 45 percent were fairly common.
Suffering more were the majority of altcoins, including Bitcoin Cash, which in the 24 hours to press time had lost 32 percent of its value compared to Bitcoin’s average of 18 percent loss.
The weight of the losses is clearly visible in overall market statistics. The total cryptocurrency market cap has fallen from $650 bln to $430 bln in a single day.
Bitcoin’s ‘magic’ month brought growth that surprised investors and observers both in and outside of the industry. Such peaks are often followed by dips or corrections.
How will new investors respond?
That the bitcoin price would endure a significant retrace following its parabolic December run should not be surprising. Although no one could predict with certainty when the correction would occur, anyone familiar with the markets knew it lay somewhere on the horizon.
For long-term investors, this retrace is par for the course. However, many bitcoin investors — perhaps even most — have never experienced a true bear market. It remains unclear how far the market will drop before it reaches a support level, but one thing is certain: it will shake out many weak hands along the way