Bitcoin’s falling below $20,000 proves there is no bottom.
Bitcoin has been climbing above $20,000 for the past week, and its ability to hold above that level through the FOMC announcement has led to speculation that the digital asset has finally bottomed out. However, recent developments and Bitcoin’s fall below $20,000 have proven that this is not the case. More than that, it points to further declines in the market that could push the cryptocurrency lower.
There is no bottom
Bitcoin is now trading at $19,000 which has completely destroyed the hope that the bottom was already marked at $20,000. Despite the digital asset’s large deviation from many established trends, it seems to be holding on to the fact that it eventually loses more than 80% of its all-time high before the next bull rally begins.
If so, then it is possible that the market will see a drop below $17,000. The question now becomes what caused such a drop in price and it can easily be traced back to the ongoing battle between Binance and FTX.
The market is already feeling the effects of Binance looking to dump more than $500 worth of FTT, which has already triggered a more than 30% drop in the token’s price. However, as is often the case in the crypto market, this is not just endemic to FTT. The effects are being felt by other cryptocurrencies such as Bitcoin which has lost nearly $1,000 in value in the last 24 hours alone.
Will Bitcoin Recover?
The bitcoin price recovery is not a debate as recovery is always inevitable after a price drop. However, no significant recovery can be expected from this point as Bitcoin has not reached its bottom yet. And until that happens, it is likely that Bitcoin will not break above $22,000.
After last week’s price increase, the market also witnessed significant selling. Investors took advantage of this to make some quick short-term gains but the result was a loss of support at $20,000.
Bitcoin, it comes in the current macro climate due to high correlation. Unless there is a settlement, it is likely that the digital asset will not see a significant pump in value. Disruptions from the macro environment and ongoing issues with Binance and FTX point to further downside for Bitcoin.