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Following last week’s massive market sell-off, the entire cryptocurrency market seems to be in a state of decline. Many observers felt that Bitcoin’s 12-month low of $5,500 on November 14th would be the worst of it – but they were wrong. Today at 10:00 am GMT, a further dip saw $5,165 become a new 13-month low for the leading cryptocurrency, sparking concern that the levels of $5,000 or lower are within sight before the end of the year.
September 4th feels like a really long time ago now. Back then, a sharp rise for Bitcoin, in particular, saw the $7,000 mark breached once more. The bulls poked their heads out, calling for further rises. But the doom and gloom of November prove one thing only; the trend is still downward. Since Christmas 2017, Bitcoin has fallen, recovered, then fallen further on an almost continuous downtrend, and now the bears think that this isn’t going to change before the end of the year.
And it’s not just Bitcoin. Ethereum is also at a 13-month low today, with the $150 mark being severely tested. In fact, all of the unpegged cryptocurrencies are in major decline if you look at the trends since January this year. The entire crypto market has dropped by 5 percent in the last 24 hours – that’s nearly $15 billion wiped off the market capitalization figures in a day.
As concerns rise over the ongoing health of the cryptocurrency industry as a whole, the US stock market isn’t helping matters. The general feeling is that the long bull run is coming to an end, with momentum slowing across the major markets. This is unlikely to do the crypto markets any favors.
Of course, there’s also the internal strife over a protocol that has caused the Bitcoin Cash fork. Roger Ver and Craig Wright have failed to agree on methods for scaling Bitcoin Cash, resulting in Bitcoin Cash ABC and Bitcoin SV. This hasn’t been good for the market so far, although Bitcoin ABC seems to be “winning” that particular battle at this moment in time.
Aside from the obvious knock-on effect a fork has, it is further proof to those who don’t champion cryptocurrency that markets are too volatile to represent positive investment opportunities. Internal wars, forks and a lack of regulation have long been a reason for financial institutions and traditional firms to turn their back on crypto, and this kind of publicity can only be a negative for the crypto market.
And the age-old claims that Bitcoin is not a reliable store of value will only be strengthened as the slide continues. Twelve-month graphs are increasingly pointing towards a return to levels last seen in mid-2017. The question on everyone’s lips now is simple: when will the slump end? It will be very interesting to see if Bitcoin pushes the $4,100 mark in the coming days.
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