After barren days, Bitcoin fell below the level of $ 40,000 and the overall market value of the cryptocurrency market fell below $ 2 trillion.
But the bulls are still betting on the crypto market and see that it still has additional bullish rounds ahead.
When the price of Bitcoin collapsed on a Wednesday last week, it caused panic and anxiety among many traders, especially those new to the game who were quick to wholesaling.
Some already fear worse, and expect another frosty winter.
Bitcoin showed signs that the uptrend may be coming to an end, especially when cryptocurrencies suffered the worst dollar-denominated decline in their history.
But many analysts believe that we are still in a bull market, and that the decline in Bitcoin’s value is too late.
Opinions of analysts and experts on the crypto market:
He told Fred Bay, CEO of 3iQ, a Toronto-based cryptocurrency index trading fund, that we had not entered the bear market yet, and that the massive Bitcoin gains over the past year were not sustainable.
This withdrawal has a lot to do with China, and how they want to take drastic action.
The market has been desperate for a reason to make the correction, anything from $ 10,000 to $ 60,000 at the time does not make sense at all, just look at the rates of return on our hedge funds, it is not humanly sustainable.
Corrections like what Bitcoin just saw have already been made with tech stocks and are very normal.
Charles Bouverd, vice president of content at Quantum Economics, echoed Fred, adding:
We are not in crypto winter.
Such setbacks are to be expected.
Bitcoin’s decline began last week when billionaire investor Elon Musk announced that his company, Tesla (which invested $ 1.5 billion in Bitcoin in February) would not accept Bitcoin as a payment method, citing environmental concerns.
This led to confusion in the markets.
According to data company Glassnode, this caused people to sell their cryptocurrency holdings.
The Chinese central bank and a few Chinese payment companies have reworked the rules limiting cryptocurrency transactions, creating more chaos in the market.
China is also cracking down on those producing bitcoins, with the Chinese Financial Commission saying last week that it would monitor Bitcoin miners in an effort to firmly prevent and control financial risks.
Bitcoin and the alternative digital currency market in general continued to decline in value, as new and nervous investors may ditch their cryptocurrencies.
Many figures in the world of conventional finance see the recent fluctuations as a sign of long-term survival forever, regardless of rising or falling markets.
Others, however, are faulty for Bitcoin’s volatility.
Jerry Klein, managing director of New York City-based Treasury Partners, which manages $ 9 billion in assets, said recent fluctuations in Bitcoin show that companies cannot rely on cryptocurrencies as good corporate cash investments.
When a company invests cash in Bitcoin, lower prices in Bitcoin can have a significant impact on earnings per share, while price increases offer no benefit.
According to some, a market downturn like this, despite its size, appears to be normal, especially given previous Bitcoin cycles.
Glassnode reported in a report that what we are seeing now corresponds to five previous major setbacks during the revolutionary ascent in 2017.
But some experts are still not sure.
Alex Krueger told a former banker and analyst that it was still too early to say what was coming.
He added, stating:
It will only become clear with hindsight.
It was not a simple, long-awaited correction.
It was a black swan in both size and speed.
Aside from Corona’s crash, it was the largest correction since 2013.
The alternative cryptocurrency Ethereum, which is the second largest cryptocurrency by market value, has been hit hard by the recent crash.
The cryptocurrency was in a frenzy in 2021, outperforming even Bitcoin in terms of annual gains.
But despite bullish sentiment surrounding its upcoming upgrade to Ethereum 2.0, and changes to its protocol that analysts argue could make it a more attractive investment, the Ethereum coin lost nearly 58% of its value after the collapse of Black Wednesday.
However, Kruger says he personally remains very optimistic about Ethereum, regardless of how other assets perform.
And he said:
It is very difficult for cryptocurrencies to accumulate sustainably without tracking Bitcoin.
In fact, bitcoin continues to be the driving train in the crypto market, so the upward journey may be full of pitfalls.