BITCOIN’S PRICE PLUNGES 20 PERCENT WORST CRASH SINCE MARCH

Mon 11 January 2021:

The price of bitcoin crashed nearly 20 per cent today to $31,756 in the worst sell-off since March 12 when it fell 37% in a single day.

The week is off to a bearish start for cryptocurrency as the price of Bitcoin fell nearly $10,000 from its Friday high of nearly $42,000, temporarily ending an unprecedented rally.

On Monday morning, Bitcoin was trading under $33,000—a more than 20% drop from its recent high—while some other cryptocurrencies fell even further.

The fall in crypto value comes amid a broader retreat on Monday for stocks, and a resurgence in the U.S. dollar.

“It’s to be determined whether this is the start of a larger correction, but we have now seen this parabola break so it might just be,” said Vijay Ayyar, head of business development with crypto exchange Luno in Singapore.

“It’s scary when the price of bitcoin just goes straight up,” said James Putra, vice president of product strategy for TradeStation Crypto. “This pullback was needed.”

The recent rally sparked concerns among several key analysts, worried that the cryptocurrency may be in bubble territory. Bank of America Chief Investment Strategist Michael Harnett last week offered that bitcoin could be in “the mother of all bubbles.” In fact, he advised clients that the recent rally, with the “cryptocurrency market now >$1tn as Bitcoin past 2 years, blows-the-doors-off prior bubbles.”

However, not all experts are using the recent plunge to issue negative bitcoin price predictions. In fact, InvestorPlace analyst Matt McCall last week wrote that he is “exceptionally bullish on bitcoin, altcoins (cryptocurrencies other than bitcoin), and the blockchain technology on which they are built.”

Bitcoin first surpassed the $20,000 level in mid-December and soared above $30,000 earlier this month — a huge rebound from a low of just above $4,000 as the Covid-19 outbreak sent global financial assets plummeting last spring.

Even with the drops over the weekend and Monday, bitcoin is still up more than 10% already in 2021 — and it has soared about 300% in the past 12 months.

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