Bitcoin Continues to Fall and Hits 6-Month Low – Is Crypto Winter Here?
The crypto market is bleeding. Bitcoin is down nearly 9% overnight and is trading at a six-month low, ETH is down 14%, Binance Coin is down 18%, and the other altcoins are also down. LUNA and Shiba Inu have lost over 25%.
At press time, Bitcoin is trading at $35,794, down 8.56% over the past 24 hours. It also fell to a fresh intraday low at $35,410. This is the lowest since late July 2021. Since peaking on November 21, when it hit a new all-time high of $68,680, Bitcoin is now down 48%. In that time, it has lost more than $600 billion in market cap.
Bitcoin has had larger percentage declines in the past. In dollar terms, however, this is the second largest drop yet. The Bespoke Investment Group issued a statement on this:
“It gives an idea of the magnitude of the value destruction that can be hiding behind percentage declines. Cryptocurrencies are of course prone to these types of sell-offs as they have a history of inherently higher volatility, but given the large market capacities, one should look at volatility in both dollar terms and percentage terms.”
SHIB and LUNA are leading the fall in altcoins
Things weren’t looking any better for the altcoins. Ethereum is down 14% over the past few days, trading at $2,490 at press time, also its lowest level in six months. The decline came despite Ether seeing a sharp increase in trading volume, which topped $27 billion, up 40% from the previous day.
Dogecoin and XRP are down 13% each, Cardano’s ADA is down 15%, and Solana, Polygon, and Binance Coin are down 18% each. Polkadot and Avalanche fared even worse, both tumbling down 20% over the past few days.
Some have lost more than a quarter of their value overnight, once again proving just how volatile the crypto market is. LUNA is priced at $58 and is down 27%, Shiba Inu is down 25%, THETA is down 28% and PancakeSwap is down 27%.
According to experts, the drop is the result of forces outside the crypto market. In the past week, investors have dumped a lot of risky assets, which include cryptocurrencies. The stock market was also hit as Netflix fell 20% in premarket trading on Friday.
Stéphane Ouellette, CEO of institutional crypto platform FRNT Financial commented :
“Cryptocurrencies are responding to the same type of dynamics weighing on risky assets around the world. Unfortunately, with some mature projects like Bitcoin, there are so many cross-correlations within the crypto-asset class that it is almost certain that it will fall into a broader altcoin valuation pullback, at least temporarily.”
The decline in cryptocurrencies has also impacted the stocks of cryptocurrency trading companies, whether directly like Coinbase or indirectly like Microstrategy. The two stocks fell 16% and 18% on Friday.