The crypto market has been seeing massive gains in the mast two months, which many have welcomed after more than a year of dropping prices. However, the situation has started changing in the past few days, right after Bitcoin (BTC) reached and exceeded $8,000. What followed was a short period of price stagnation, only for it to start dropping.
In the last 24 hours, BTC has seen a drop of over 11%. This is the largest decline within a single day since mid-November when BTC dropped from $6,300 to $3,300 after the Bitcoin Cash hard fork incident. The lowest that the price has been observed to drop in the last 24 hours is down to $7,185. Now, however, a slight recovery appears to be at hand, with BTC price at the time of writing being at $7,329.12.
Why did the prices drop?
At this point, it is unclear what caused the price decline, although there are several theories going around. One possibility is that it simply came as a result of an oversale. The prices were growing rapidly, and many saw an opportunity to make a profit by selling the coins they were HODLing.
According to TokenAnalyst’s recent data, most major crypto exchanges have witnessed major outflows in the past few days. In total, around $622 million more left the exchanges, than it entered. With a situation like that, it would not be surprising if this was a reason why BTC price went down.
Another theory is that a major sell order noticed on Bitstamp might be the reason. However, if this is the case, then the investors and traders have to deal with a very fast market reaction, as there was already a $500 difference in BTC price from the moment the sell order was placed, to the moment of an actual sale.
If there is another reason, it is currently unknown, so most in the community believe that it all comes down to either an oversale or a massive dump on Bitstamp.
Bitcoin still sees a general rise
One thing to note is that, even though Bitcoin dropped by over 11% today, the coin still sees a general rise in value. During the last week, it went up by around 23%. In the past six weeks, Bitcoin saw constant growth, and while many were predicting a correction — a lot of analysts think that there is still more than enough room for further growth.
It is well-known that there are some extremely bullish analysts out there, one of which is Max Keiser, Keiser Report’s host. Keiser believes that Bitcoin is going up to $100,000 in the near future and that there are multiple reasons why investors should be bullish. Some of the reasons are medium-term monetary policies, long-term fundamentals, and alike, all contributing to a bullish environment.
Of course, Bitcoin is currently still far below its current all-time high of $20,000. In fact, its current value is at around 60% of this achievement. But, if Keiser and others like him are right, BTC will soon reach this value, and leave it behind as it heads for the $100k mark.
Bitcoin is not the only one dropping
Apart from Bitcoin, the rest of the market lost a decent portion of the price as well. Ethereum, the second largest coin by market cap, currently has a price of $242, with 6.82% drop in the past 24 hours. Then, there is XRP, which was one of the best-performing coins in the last few days, and is currently among the biggest losers in the top 10 largest coins, with a 13.97% drop in the last 24 hours.
Cardano (ADA), the 10th largest coin at the moment, is also the largest loser, with the coin’s price dropping by 14.81% in the last day.