What Caused Bitcoin's Price to Dip Today?
The key points and primary reasons you need to know for Bitcoin's drawback. Will it continue to decline or will BTC's price surge?
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فارسی If Bitcoin had a shrink, it would probably be diagnosed with bipolar disorder. From highs to ultra-lows, the swings in Bitcoin have been turbulent during 2022, hitting the lowest point of $15,654 on November 21.
The sell-off came amid a market-wide decline caused by investors and Bitcoin holders running for safety in fear that the FTX exchange induced contagion would infect the whole crypto market.
The crypto market wasn't the only disappointing side effect as stocks closed red on the day, with Nasdaq in the red zone 1% and the S&P 500 down 0.42% with growing concerns amongst investors on rising interest rates.
Over $100 million in leverage were liquidated between Nov 20-21 as holders in fear of accelerated sell-off if DCG and Blockfi fail to secure finding and are forced to declare bankruptcy. Many analysts are predicting that Bitcoin will continue to decline to $14,000, which would put 10,000 Bitcoin at risk of liquidation.
The main reasons Bitcoin is down today
The price of Bitcoin seems to be reacting to the level of stress placed on the crypto market by the FTX exchanges saga, reaching a 2022 yearly low, after many analysts though that the bear market was soon to see an end. Data from Glassnode indicates that $1.45 billion in realized losses during the week of November 12, the fourth largest in Bitcoin's history.
Glassnode noted that , “A comparably small $83M in realized profits occurred, suggesting that the vast majority of spent volume at present is sourced from investors from the current cycle.”
Bitcoin affected by the rising interest rates in the US.
Inflation in the US have increased by 0.6% in September in comparison to previous months, according to the Consumer Price Index Report, the most followed barometer of inflationary pressure. Comparing September to last year to date, climbed 8.2% in September compared to the same month a year ago, slightly more than the 8.1% predicted by experts. With the CPI upcoming reporting event on Nov. 10, BTC saw a volatile 12% decline in 24 hours hitting an all time low for 2022.
Could Bitcoin reverse and see a skyrocketing effect?
Institutional investors' long term outlook into Bitcoin seems to not have changed despite the ongoing bear market of 2022. According to Robin Vince, CEO of BNY, a poll commissioned by the bank found that 91% of institutional investors were interested in investing in tokenized assets in the following years.
For long term traders, Bitcoin is expected to go up, due to more acceptance of digital currencies in banks and financial institutions an are seemingly turning to cryptocurrencies for settlement purposes even during the chaos of 2022.
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