Bitcoin fell as low as $18,500 on Tuesday night as the original cryptocurrency faced a series of headwinds that drove it to its lowest price in nearly two years.
The currency rallied slightly on Wednesday morning but remained below $19,000, an important psychological support level that has held since lows in mid-June when the TerraUSD implosion triggered a broader meltdown. in the crypto markets.
Bitcoin’s recent price drop also coincides with a drop in performance against other crypto assets. This was reflected in its overall crypto market share, known as Bitcoin Dominance, which fell below 40% this week, a level not seen since the first half of 2018.
triggered the collapse of crypto lender Celsius and a major hedge fund called Three Arrows Capital.
The absolute drop in the price of Bitcoin only tells part of the story: it has also gradually decoupled from other crypto assets. Last week, its share of the overall cryptocurrency market, also known as Bitcoin Dominance, fell below 40%, a level not seen since the first half of 2018.
Meanwhile, Bitcoin’s biggest rival, Ethereum, whose native token is ETH, traded near all-time highs with BTC.
A number of other factors have been bearish for crypto and Bitcoin in particular lately. These include macroeconomic forces, particularly Jay Powell’s remarks in Jackson Hole last week where the Federal Reserve Chairman decided to maintain a course of interest rate hikes to stifle inflation. This has boosted sentiment towards the dollar, which has appreciated against all other fiat currencies like the euro as well as their digital rivals.
Meanwhile, there has been negative news relating specifically to Bitcoin, including fears that the coin distribution of bankrupt Mt. Gox Bank could introduce a new glut into the market.
Then there’s Microstrategy, a so-called bitcoin whale, which has halted buying in recent months as its founder Michael Saylor faces tax evasion allegations, raising fears the company is moving on from a buyer. net to a net seller.
Bitcoin miners, who provide the computing power needed to run the network, are also struggling to cope with soaring electricity prices eating away at their profits, prompting some of them to sell off. that they exploit.
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