Following a decline of more than 15% in an hour on Tuesday, the Bitcoin price fell another 8% Thursday morning. After rising to a high of $8,629.96 on Binance, where Bitcoin is traded against the U.S. dollar-backed Tether stablecoin, Wednesday evening, the world’s most popular cryptocurrency fell to a low of $7,750 around noon on Thursday. This amounts to a total decline of roughly 10%.
Bitcoin’s sharp decline started around 9:15 a.m. on Thursday, when the price was still over $8,400. The price was hovering around $7,900 at the time of this writing, which is a roughly 18% drop from the start of the month.
Unlike the drop seen on Tuesday, major altcoins like Ether and Litecoin have moved at roughly the same pace as Bitcoin, rather than dropping at a faster rate (according to data from CoinMarketCap). In fact, Ether has shown well against Bitcoin over the past 30 days. Last week, the altcoin had one of its best ever 24-hour trading periods against Bitcoin. Of course, Ether is still down massively from where it was trading against Bitcoin a couple of years ago.
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Potential reasons as to why the Bitcoin price is on the decline have been heavily discussed on Crypto Twitter. Two of the main theories that have been floated revolve around Bakkt’s slow start and the potential delay (or even cancellation) of Facebook’s Libra cryptocurrency project.
While Bakkt is focused on physically settled Bitcoin futures, it should be noted that there are fundamental differences between how Bitcoin and Libra are structured. Due to the higher degree of centralization seen in Libra, some have questioned whether it should even be considered a true cryptocurrency.
Falling below the $8,000 level could mean Bitcoin would test its 200-day moving average support, which sits around $7,000. And according to the Trading Envelope Indicator, a technical tool that smooths moving averages to map out higher and lower limits, the coin has fallen below its lower band.
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