According to Tradingview, the world’s most popular cryptocurrency, Bitcoin, hit a new low of $20,828 at the start of the week. Because of this new pricing, BTC lost 16.54% of its value in less than a day- almost $5,000 in value.
Although being the largest and most famous cryptocurrency, Bitcoin is notorious for its huge climbs and equally dramatic declines. For example, BTC skyrocketed to an all-time high of over $69,000 in November 2021, then plummeted to just under $30,000 by the start of 2022.
Related Reading | Bitcoin Long-Term Holders Realize March 2020-Like Losses As BTC Crashes
Bitcoin’s value peaked above $30,000 on June 1, 2022, but dropped below that the next day. It is currently trading below $22,000. This decrease is linked to TerraUSD, a stablecoin, breaking its $1 peg and Luna subsequently falling.
In addition, it reflects global financial uncertainty driven by increasing inflation as investors seek to sell “riskier assets” such as cryptocurrencies.
The Bitcoin 3-Day Chart Indicates March 2020 Crash
The 3-Day Bitcoin chart Indicates a recurrence of the March 2020 Crash, based on the present state of the BTC market. Bitcoin’s popularity as a safe-haven asset began to wane in March 2020. It had lost half of its value in only two days.
After opening the week above $9,000, the cryptocurrency suddenly fell below $4,000 on March 13, 2020. However, as of the end of U.S. markets, it had returned to around $5,400.
Bitcoin is currently trading below $22,000 on the daily chart | Source: BTC/USD chart from TradingView.com
For the March 2020 crash, Joe DiPasquale, CEO of BitBull Capital, said that the global pandemic of the coronavirus caused investors to move their money into cash as a form of protection.
He further added that Bitcoin’s potential as a safe-haven asset is being questioned due to this steep decrease. But feels it is too early to look for any links between Bitcoin and other asset classes.
Reason Behind Bitcoin Plunging To New Lows
One factor contributing to bitcoin’s new lows is the halting of all withdrawals, transfers, and swaps between accounts by Celsius.
Celsius, a DeFi platform and one of the largest crypto lenders has been a significant cause of mistrust in the Bitcoin market.
The network announced they had paused withdrawals, swaps, and transfers between clients via Celsius. This announcement was made in the early hours of June 13, following Bitcoin’s slide below $24,000 and the whole crypto market losing about $250 billion in only seven days.
As the company’s announcement stated:
Due to extreme market conditions, today we are announcing that Celsius is pausing all withdrawals, Swap, and transfers between accounts. We are taking this action today to put Celsius in a better position to honor, over time, its withdrawal obligations.
Featured image from Flickr and chart from TradingView.com