Bitcoin Falls to $64k after Reaching Record High

Bitcoin-Falls-to-$64k-after-Reaching-Record-High

Bitcoin Falls to $64k after Reaching Record High

Are you a crypto-lover? If yes, then you must be aware of the sudden fluctuation of the giant cryptocurrency Bitcoin (BTC).

The news is everywhere that Bitcoin has decreased in value over the last two days.

As of March 20, 2024, it’s worth $64,018.90, and its market value is $1.20 trillion.

On March 12, the price of Bitcoin was around $70,000.

But it later soared and surpassed all-time highs. On March 14, 2024, it hit a new high of $73,750, and its market value reached $1.44 trillion.

One factor that could possibly illuminate this situation is the growing interest and investment in blockchain solutions.

For a while, everyone was excited about the cryptocurrency (even too much): they’re still pretty excited about it, but not that much.

Bitcoin prices went through the roof and hit $73,750, setting a new all-time high and beating earlier records set in the second week of the month. But since then, Bitcoin prices have dropped below $65,000. This could be because of several unknown reasons.

This article details what caused Bitcoin to drop after hitting a new high.

 

Recognising the Abrupt Bitcoin Price Decline

Recognising-the-Abrupt-Bitcoin-Price-Decline

As of the first few weeks of March 2024, Bitcoin’s value had grown by 74%, and its post-exchange traded funds (ETF) flows had grown by an amazing 90%. But lately, there have been big drops in its value several times in just two weeks, which means that the rapid increase in Bitcoin’s value might be slowing down. This doesn’t necessarily mean the future will be bad, but it does mean that the crypto market as a whole will be stable for a while.

An essential rule of financial markets says that whatever goes up must come down. This means that Bitcoin had to have a drop after hitting a very high level. Throughout history, whenever asset prices have risen at a high level, and very often, there’s always been a time when they’ve gone down or stayed steady for a while.

Investors were increasingly worried about a drop in Bitcoin’s value after its meteoric rise, especially in the last few months. These natural ups and downs in the market show how investor mood changes over time and how markets seek balance. As a result, Bitcoin’s price dropping after a time of strong growth was not a surprise but rather something that could have been expected based on how markets usually work.

Making a profit could be another important reason. Buyers usually sell their holdings following big price increases to get their money back. This happens constantly in financial markets, even ones that deal with cryptocurrencies. When prices go up quickly, buyers may worry that the trend might change or even go backward, which makes them sell their assets to lock in their gains. When more buyers start to sell, the price may decrease because there is more pressure to sell. Taking profits can make price drops worse, especially if there aren’t enough buyers to counteract the selling pressure.

Bitcoin may have dropped to $64k because of market trickery. Because cryptocurrency markets are still new and not as well-regulated as standard financial markets, they can be manipulated. Large investors or groups of traders, who are sometimes called “whales,” can change prices on purpose to make money.

The “pump and dump” plan is a common way to manipulate prices. This is when a group of investors artificially raises the price of a cryptocurrency by buying it all at once, which makes regular investors want to buy it all. When the price hits its highest point, the manipulators sell their holdings for a profit. This causes the price to drop, which means other investors lose money. Because it changes the way the market works and provides fake demand, market manipulation can cause prices to drop quickly.

Investors should be aware of these fluctuations and be careful when dealing in markets that are likely to fluctuate.

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What market trends can Bitcoin expect in the future?

The price of Bitcoin recently went up a lot and hit a new high. Investors thought it would continue after this, but it dropped again. Bitcoin was doing well in March. Each Bitcoin was worth over $73,000, and the overall value of all Bitcoins was over $1.35 trillion, showing a strong trend of going up.

The fact that Bitcoin’s price has dropped again shows that it still has a long way to go. Some investors who work with investments at Coinswitch Ventures say that this drop is good because a regular part of Bitcoin’s value is going up and down. Bitcoin is affected by what’s happening in the market as a whole, not just Bitcoin itself.

For instance, when the U.S. reported higher than predicted inflation, it made investors less sure that the Federal Reserve would soon lower interest rates. This caused buyers to sell stocks and cryptocurrencies, which they saw as risky.

The U.S. Federal Reserve will hold a meeting on March 19, 2024. However, most investors believe that interest rates will stay the same. They are all waiting to see what the Federal Open Market Committee chooses.

According to Rajagopal Menon, who works at WazirX, the price of Bitcoin will likely stay between $62,700 and $68,900 for a while, maybe even until April. He thinks the price will go up again soon because more investors will want to buy Bitcoin, and fewer new Bitcoins will be available because of an event called “Bitcoin halving.” They all agree that now is an excellent time to buy Bitcoin because its price is decreasing.

 

Bitcoin is now closing at $64k. Should You Consider Exiting?

Bitcoin-is-now-closing-at-$64k-Should-You-Consider-Exiting

It is hard to say what will happen with Bitcoin’s price, like whether it will drop sharply, because Bitcoin markets are so volatile and complicated.

This past week, a record amount of money came into U.S. Spot Bitcoin ETFs, $1.05 billion, beating the old high of $678.67 million. Demand-side forces will push Bitcoin prices up since a lot of money is coming in. The recent rise in Bitcoin’s price may bring in new buyers who missed the chance to buy when the price was lower. This “FOMO” (fear of missing out) effect can make more investors want to buy something and help prices go up in the short run.

In addition, the upcoming Bitcoin Halving event will lower mining rewards, which will cause supply-side pressures that will help prices rise.

Edul Patel, CEO and co-founder of Mudrex, thinks that now, when the cryptocurrency market is going down, is an excellent time to save money and spend it in a planned way to reduce risk and make the most money in the long run. Currently, $61,500 is a support level for Bitcoin, and $68,500 is a resistance level.

A technical research tool called the Relative Strength Index (RSI) shows that Bitcoin is getting close to being oversold. Patel says that when the market is oversold, it usually means that the direction is about to change, which is an excellent time to get in.

Bitcoin’s price may go through periods of instability and speculative bubbles. Still, its long-term value will rely on many things, such as how clear the rules are, how widely it is used as a store of value or a means of exchange, how quickly technology improves, and how much investors want it.

In the past, during bull runs, crypto assets have seen big declines of 20% to 30% before starting to rise again. There may be times when investors take profits, which causes prices to drop, but generally, the trend for Bitcoin is still up.

Chaturvedi tells traders to be careful when using leverage because price changes that are too big or too small can cause liquidations. The planned halving of miner rewards on April 20 will likely significantly change the supply of Bitcoin, which could have a significant effect on prices.

 

The Cryptocurrency Future is Beyond Bitcoin

The-Cryptocurrency-Future-is-Beyond-Bitcoin

When the price of Bitcoin goes up a lot, it often causes the prices of other cryptocurrencies, like Ethereum and many altcoins, to go up. This is something that keeps happening in the cryptocurrency market. Here are some of the reasons behind this trend:

 

  • Since Bitcoin prices are increasing, investors and traders are also hopeful or positively emotional about other cryptocurrencies. They believe that if Bitcoin is doing well, then all cryptocurrencies must also be doing well.

 

  • Since the markets for all cryptocurrencies are linked, when Bitcoin goes up, more investors and traders also trade and buy in other cryptocurrencies. Their prices go up because of this.

 

  • When the news says that Bitcoin’s price is going up, investors are afraid that they will miss out on a chance to make a profit or fear missing out. So, they rush to buy other cryptocurrencies, hoping to make the same gains.

 

  • Cryptocurrencies like Ethereum differ from Bitcoin. Also, it has and has unique traits alike. Investors who invest might think these other cryptocurrencies are valuable because they have new technology, a strong supportive community, and use cases. This makes more investors want them, so their prices go up.

 

  • Many investors in the coin market like to buy and sell currencies when their prices change to make quick money. Investors start to buy other cryptocurrencies when Bitcoin’s price increases significantly. This makes the prices of those other cryptocurrencies go up, too.

 

Conclusion

Compared to traditional financial assets, cryptocurrencies like Bitcoin don’t have to follow as many rules. Investors may fear regulatory uncertainty because they think that regulators may crack down or bad legal events could happen that could affect their investments.

Short-term demand for Bitcoin and other companies may be driven by good feelings and the fear of missing out. However, long-term worries about regulatory uncertainty and the currency’s ability to maintain its value may change its course.

When rules are finally established for cryptocurrency, the market could become more stable and legitimate. Clear rules and regulations could calm investors’ worries about losing money and boost trust in the cryptocurrency environment.

We hope you find this blog informative. So, to enhance your financial operations, call Sky Potential U.K. and infuse blockchain strategy into your business operations.

Connect with us for expert blockchain consultancy today.

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