BTC detected a drop in its cost of 9.34% last week. Econometrics warned that the price of BTC could crumble down to at least $30,000.
Bitcoin (BTC) keeps presenting red figures after lowering its cost to at least USD 34,000, making the digital currency market lose about USD 200 billion in capitalization.
On the last day, the leading crypto asset lowered its price by 3.68% and 9.34% in the previous week. These harmful amounts also got detected in other digital currencies such as ether (ETH), Ethereum’s native asset, which crumbled to at least 7.93% in the last week.
The decline of bitcoin made the market go through levels it previously approached in July 2021 when the market cap dipped as low as $1.2 billion, as highlighted by CoinMarketCap.
Although there is a slight recovery, which took the capitalization to USD 1,800 million, the leading currency continues to have a negative performance that didn’t happen since 2014, being five consecutive red weeks for BTC.
Everything appears to highlight that bitcoin could approach six weeks of low performance. Bitcoin has never reached seven uninterrupted weeks working with such red numbers.
Fear Attacks Traders and the Traditional Market Shakes after this Situation
The fall in the cost of bitcoin keeps causing extreme uncertainty in traders. On May 6, the measures experienced a downgrade registered from 27 to 22. On May 8, that fear reaches new high peaks, approaching 18, in accordance with Bitcoin Fear and Green Index, a network that gathers information from social media, surveys, volatility rates, and trading volume reports.
This fear also impacted the stock market last Friday, when it had the worst fall since 2020, letting go at least 1,000 points of the Dow Jones index. This event happened due to investors’ fear of the US economic procedures in the medium and long term.
Both the market-oriented to crypto and the usual financial space received unprecedented damage by this uncertainty caused by the government procedures taken by the United States of America after the increase in interest rates by 0.5%, as revealed by the Federal Reserve.
This situation relies on a resource applied by central banks to obstruct credit and stimulate savings. By reducing consumption levels, theoretically, inflation should also decline.
US annual inflation reached a record high of 8.5% in mid-April, the highest in 41 years. In Europe, something like this inflation when year-on-year headline inflation went 7.5% in April.
The ascension of the inflation worldwide is a consequence unleashed by the current conflict between Russia and Ukraine, which increased food and energy prices. The latter significantly damages Europe because many of the nations that make up the community need Russian gas and now face economic punishments that block their economies.
Willy Woo says that cryptocurrency’s price could continue its road to decline. However, he thinks that the recovery in value will be quick and detects a long-term bullish performance. Woo also highlighted that a supply shock structure is under construction, with solid purchases of bitcoin not being reflected in the price.
By: Jenson Nuñez
