Certainly these aren’t fun days for cryptocurrency investors, as Bitcoin didn’t catch a breath above $40,000 until it entered a new bloodbath.
The cryptocurrency market overall is down 5.70% and has fallen below $1.4 trillion at the time of this writing.
The world’s largest cryptocurrency has fallen in value by 7% and is currently trading at $32,932 with a market capitalization of $619 billion.
Possible reasons for the downside of the crypto market:
Bitcoin failed to maintain critical support levels, and amid China’s recent crackdown on local miners, the hash rate of the Bitcoin network has also fallen by 30%.
After hitting $40K last Tuesday, Bitcoin has been constantly trading under pressure and it looks like the next level will be $30K.
In addition to stopping Bitcoin mining in China, it appeared that there is a great correlation between Bitcoin and the stock market recently, as stocks suffered a significant decline, and Bitcoin followed its movement as well.
Crypto market analyst Willy Wu noted that the strength of the US dollar index (DXY) made money flow back into the dollar as investors looked for safety.
This may lead to weakness in stock markets in the future.
Thus, Bitcoin remains at risk of further correction from this point onwards.
A quick look at the altcoin market:
The price of Ethereum is down almost 9% today and is close to the $2000 levels but is largely flat.
After hitting an all-time high of $4,400 in mid-May, Ethereum has been trading sideways for a while now.
The price of Ethereum since its highest peak until now has fallen by more than 50%.
Cryptocurrency DOGE and XRP are the biggest losers in the top ten list with their prices crashing 10% and 8% respectively at the time of writing this article.
DOT gained momentum last week, as the price of the coin exceeded $25, but it did not continue and its price fell by 10.4% and its price is currently $18.
It is clear that the general market scenario remains bearish at this stage and the bulls are facing a difficult time, followed by profit taking on each price hike during the past week.