Bitcoin was on the path to end on Tuesday under $30,000 per coin for the first time in 2021.
Bitcoin, the top cryptocurrency by market cap., decreased by as much up to 4.6% to $29,393 per coin. It has not ended under $30,000 since December 31.
“The latest fast sell-off in the cryptocurrency sector is seeing giants like Bitcoin and Ethereum hitting vital support levels that are turning more fragile,” said Nicholas Cawley, who is an analyst at DailyFX. “The lack of a return over the previous three weeks means that traders are no longer wanting to ‘buy the dip.’”
Tuesday’s decrease comes one day after a broad downfall in risky assets and as the current Treasury Secretary, Janet Yellen, has called on officials to create a legal framework for regulating stablecoins, which are supported by a reserve asset such as the U.S. dollars. Stablecoins give holders the privacy of crypto and the stability of fiat money.
Bitcoin’s value had spent the previous two months going between $30,000 and $40,000 after China in May caused a selloff after urging a crackdown on cryptocurrency mining.
The price of bitcoin had gone up by as much as 116% in 2021, hitting a top at $63,503 in April, as a number of United States companies, including Tesla and MicroStrategy, started investing in the crypto as a strategy to diversify their holdings.
Analysts state that bitcoin’s bear run still has the ability to go lower.
J.P. Morgan researchers said last month that the cryptocurrency’s share of the overall crypto market would have to go back over 50% before they get more comfortable and believe the selloff is over.
Tuesday’s selling pushed bitcoin’s market cap down to $555.6 billion, or around 46% of the total $1.2 trillion crypto sector.
Bitcoin’s market cap hit a high over over $1.1 trillion back in April, or 70% of the total crypto space.
This comes at a time when more alternative cryptocurrencies are making news and getting support, such as Dogecoin as alternatives to Bitcoin, along with its number one competitor, Ethereum.
Author: Steven Sinclaire