Bitcoin expert Roman Reher assesses the crash in the Bitcoin price and also answers the question of whether Bitcoin can once again prove to be a safe investment haven, as it once was. Looking back at the Corona crash in 2020, the professional is hopeful.
Bitcoin has experienced its worst price drop in more than two years. The price of the oldest and best-known cryptocurrency even dropped below the $50,000 threshold on Monday on the Bitstamp trading platform, reaching its lowest level since February. The digital currency then recovered slightly to just under $52,000. Since Friday evening, Bitcoin has lost about $10,000 in value. The last time a similarly sharp price drop occurred was in June 2022. The second most important cryptocurrency, Ether, was also hit hard.
Bitcoin had already fallen sharply last week. Analyst Timo Emden from Emden-Research spoke of a “cocktail of uncertainty” that is currently weighing on Bitcoin. “In particular, the renewed fears of recession in the USA are catching investors off guard,” said Emden. Recently, there had been several disappointing economic data releases in the USA. In particular, an unexpectedly weak labor market report from the US government caused concern. In July, unemployment in the world’s largest economy rose to its highest level in almost three years.
Turbulence affects other cryptocurrencies
In addition to Bitcoin, other cryptocurrencies were also under strong selling pressure at the beginning of the week. The price of Ether fell by around 15 percent to $2,340. This also represents a setback for the newly launched Ethereum ETFs, which were intended to attract new investors in the USA. With the recent price losses, the market capitalization of all cryptocurrencies has decreased significantly. It fell by around 14 percent to $1.85 trillion. Bitcoin’s share was recently estimated at around 56 percent.
A week ago, Bitcoin had risen to just under $70,000. Statements by Republican presidential candidate Donald Trump at the “Bitcoin 2024” conference in Nashville had pushed the cryptocurrency toward a record high, last reached in March at just under $74,000. Trump had promised to make the US the “crypto capital of the planet and the Bitcoin superpower” if he returned to the White House after the election in November.
The price development over the past week shows once again how susceptible to fluctuations trading in cryptocurrencies is. There are therefore repeated warnings about possible large price losses with Bitcoin and Co.
