Bitcoin’s $55K Misery Piles onto Altcoins as Losses Drag

Bitcoin leads smaller cryptos in a market bloodbath as it trades at a price level last seen in February.

Girl sinking in quicksand holding a bitcoin.
Created by Kornelija Poderskytė from DailyCoin
  • The price of Bitcoin sank to a four-month low on Friday.
  • The decline pushed BTC towards its worst weekly performance in a year.
  • Other coins printed double-digit losses in the last 24 hours.

After choppy price movements for the better part of the week, Bitcoin’s (BTC) downward trajectory gathered pace Friday, sending the world’s largest crypto asset by market cap to levels last seen in February.

BTC briefly encountered its all-high level of $73,803.25 in mid-March buoyed by the sudden influx of funds from the newly launched U.S. spot ETFs. Inflows to these funds have since ebbed and the crypto asset is down 21% from its all-time high.  

Bitcoin Extends Fall

On July 5, Bitcoin plunged below $55,000 for the first time in four months. The crypto asset hit a low of $53,717 at 7:20 am (GMT+3) before paring losses somewhat to exchange hands at $54,343 as of press time, CoinMarketCap data shows.

Sponsored

Bitcoin’s weeklong volatility comes amid market fears fueled by several challenges. In addition to the waning demand for Bitcoin ETFs and the hard-to-parse impact of US political flux, reports suggest governments are readying to dispose of the crypto asset in the millions.

On Thursday, the German government moved 1,300 BTC ($76 million) to Coinbase, Kraken, and Bitstamp, moments before shifting 1,700 BTC ($99 million) to address “139po”, which is suspected to belong to an exchange.

Mt. Gox has also moved $2.7 billion worth of the crypto asset in preparation to pay its creditors. The defunct crypto exchange plans to reimburse about $8 billion BTC in stages, adding to liquidation fears as speculators are uncertain how much of the haul will be sold.

Sponsored

As Bitcoin heads to its worst weekly performance in a year, other crypto assets are not spared from the market bloodbath.

Market Bloodbath

Bitcoin’s plunge on Friday came as smaller cryptocurrencies like Ethereum (ETH) and Binance Coin (BNB) nursed double-digit losses. ETH had lost 10.21% in the last 24 hours to trade at $2,893 while BNB exchanged hands at $477.50 after losing 11.48% over the same period, CoinMarketCap data shows.

The wider market decline comes after the Federal Reserve on Wednesday released minutes from its June meeting which showed officials are unlikely to cut interest rates until new data positions inflation at “sustainable levels” toward the central bank’s 2% target.

Higher interest rates dampen investor appetite for riskier assets like Bitcoin and other cryptocurrencies.

Read about the controversial Bitcoin “HODL Tax” proposal:
Bitcoin HODL Tax: Relief for Miners or Diamond Hand Penalty?

Stay updated on Metaplanet’s latest Bitcoin acquisition:
Metaplanet Advances $6M Bitcoin Plan with First Purchase

This article is for information purposes only and should not be considered trading or investment advice. Nothing herein shall be construed as financial, legal, or tax advice. Trading forex, cryptocurrencies, and CFDs pose a considerable risk of loss.

Author
Brian Danga

Brian Danga, a Kenyan crypto reporter, is dedicated to delivering breaking news and updates from the cryptocurrency world. With a background as a Web3 writer and project manager, he recognizes the importance of unbiased reporting. Holding an LLB degree from the University of Nairobi, Brian's analytical skills contribute to his accurate news reporting. His personal interests include cooking, watching documentaries, reading, and engaging in intellectual discussions.