Bitcoin Had a Rough Day Yesterday; Falling $3,000 In Just 24 Hours After Reaching $13,700
- The price of Bitcoin has moved to $13,700 and then fell to $10,7000
- The digital currency has always experienced large price swings
The most popular digital asset, Bitcoin (BTC), has fallen over 20% from $13,700 to $10,700 in just a few hours. The digital asset has been growing day after day during the last weeks and the market was very enthusiastic about the future of the digital currency.
Bitcoin Fell Over 20% In 24 Hours
The cryptocurrency market has always been volatile and digital assets could always experience fluctuations of over 20% in just a day. For example, Bitcoin surged to $13,700 on June 26 after experiencing a 20% increase. Once it surpassed $13,700, the virtual currency fell to $10,700 in 24 hours.
According to some reports, the price decline started when Coinbase was affected by an outage that didn’t allow users to perform their trades. Although it did not last long, it was enough to start a massive drop in the price of Bitcoin. The outage experienced by Coinbase happened due to high volume at the exchange.
Clearly, the digital currency experienced a fast price increase during the last months, and in just a few days, the virtual currency surged 50%, which is not healthy for the whole space.
The CEO of Genesis Global Trading, Michael Moro, commented:
“Even the most optimistic crypto bulls would tell you that a 50%+ move in a week is too much too fast. The presence of leverage exacerbates the moves in both directions and affects the speed dramatically. Of course, Bitcoin has a history of doing this (both upward and downward), but it’s hard to call the magnitude of the move healthy.”
At the same time, Brian Kelly, the CEO and founder of BKCM, believes that leverage has played an important role in the dramatic swings that Bitcoin experienced during the last days. At the same time, borrowing costs have also increased, which make it more expensive to make a bullish bet on Bitcoin going up.
According to Michael Novogratz, the CEO of Galaxy Digital, Bitcoin started this price increase thanks to the announcement made by Facebook about its digital currency Libra. Is not the first time that the virtual currency experiences such large price movements in a short period of time. Many investors and analysts considered that Bitcoin grew this year just because it worked as a hedge against uncertainty in the geopolitical landscape with the trade war between China and the United States and also conflicts in the Middle East.
I have to say taken out of context some or I wasn’t clear enough. Of course you would rather have sold something if you could buy it down 30 percent the next day. I do think we consolidate 10-14k before next move higher. I am still very bullish $btc. Still would love a drink
— Michael Novogratz (@novogratz) June 28, 2019
Novogratz explained that Facebook starting to work with virtual currency means that one of the most important and large firms in the world believes in cryptocurrencies. Investors are following these trends very closely and take decisions thinking about these messages that large firms give to the market. Furthermore, he explained that a large part of the current volume comes from Asia.
At the time of writing this article, Bitcoin is being traded around $11,700 and it has a market capitalization of $229 billion. In the last 24 hours, the virtual currency lost 7% of its value.