Bitcoin Price in One of Worst Weeks Ever
The past week has turned out to be one of the worst for Bitcoin as the price of the top cryptocurrency by market cap fell below $20,000 for the first time since 2020. The price, which dipped to as low as about $17,770 also broke a major record in the cryptocurrency’s history – dropping below its previous halving cycle’s high of about $19,700 in December 2017 for the first time on Saturday, June 18 – with the -13% lap below $18,000 happening in less than 24 hours.
As of press time, though, Bitcoin has rebounded past $20,000 from the Saturday low while Ethereum’s price action which earlier gave up the $1,000 support followed with almost 30% gain.
Attributed in part to the tighter monetary policy being introduced in global markets to tackle inflation and fears of a looming recession which also affect stocks, the current price puts Bitcoin at about -73% correction from the November 2021 high of $68,900. While the Federal Reserve raised its interest rates by 75 basis percentage points in what has been described as its most aggressive hike since 1994 on Wednesday, a key industry event that took place during the week and could have contributed to the downtrend is major crypto staking and lending firm, Celsius, locking up its $12 billion in crypto assets under management which raised concerns about the platform’s solvency. There was also the developing insolvency claim against crypto investment firm Three Arrows Capital.
Crypto data analytics firm, Glassnode, had earlier in the week reported that Bitcoin investors locked in the largest USD-denominated Realized Loss in history the previous week indicating realized net losses of over $4.23 billion on Bitcoin spent on-chain in the week. It says the recorded losses cover all the major sell-offs in 2021, and 3x larger than March 2020.
“The trend in crypto is clearly not positive,” says DoubleLine Capital CEO Jeffrey Gundlach on CNBC’s ‘Closing Bell: Overtime’ as he shared that he won’t be surprised to see the top cryptocurrency dip to $10,000. “It looks like it’s being liquidated. So I am not bullish at $20,000 or $21,000 on Bitcoin. I won’t be surprised at all if it went to $10,000.”
Meanwhile, MicroStrategy’s Michael Saylor told Bloomberg in the buildup to the price fall on Tuesday that he does not regret investing in Bitcoin and his company will hold on to their acquired Bitcoin regardless of what the price says.
“Our strategy is: we are going to acquire Bitcoin,” Saylor said in the interview. “We have free cash flow from time to time so we are going to dollar cost averaging into Bitcoin and we are going to hold the Bitcoin for the long-term. So, it wouldn’t really matter what the price was – 10% more or 20% more or 50% more – we are just going to progressively acquire Bitcoin because that’s our strategy. Right now is not a bad price, we’ll keep buying more.”