|
According to Bloomberg News on the 26th (local time), the price of bitcoin plunged more than 20% this week alone. This is the biggest drop in 11 months since March, when it plunged to the level of 4100 dollars due to the Corona 19 pandemic (a global pandemic).
Also, the Bloomberg-Galaxy Crypto Index, calculated by Bloomberg, fell 23% this week. This index is calculated based on the price of a total of five major virtual assets, including Bitcoin and Ethereum.
As of 7:25 am on the day, in CoinMarketCap, which averaged the market prices of major exchanges traded in dollars, the bitcoin price has fallen by more than 7% compared to 24 hours ago, and remains at the level of $45,700. Accordingly, the market capitalization has also dropped to the level of 8438 billion dollars.
In recent years, growing concerns about inflation in the market have fueled the prospect that the Federal Reserve (Fed) could turn to monetary tightening early as the market interest rate jumps, which led to a decline in overall asset prices regardless of risky and safe assets. Bitcoin price decline is also being accepted in the same vein.
“Dangerous assets are hit harder especially in the current phase,” said BJ Ayar, Asia Pacific CEO of Luno, a virtual asset exchange headquartered in Singapore. “The stock price declines first, followed by virtual assets.” He added, “As the dollar strengthens due to the rise in US interest rates, we are putting downward pressure on bitcoin and virtual assets.”
In addition, market volatility seems to be increasing due to large-scale bitcoin selling and bitcoin option expiration dates in the grayscale bitcoin trust, the world’s largest virtual asset indirect investment product. Ayar said, “After the option maturity was settled, it was burdensome for many investors to convert it into cash (rather than reinvest in Bitcoin).”
However, there is a prevailing argument that there is an early sense of determining the price direction. Craig Earllam, senior market analyst at OANDA Europe, said, “It is the market that has gone into an overbought phase that is difficult to understand, and then adjusts so quickly.”