There is good news and bad news when it comes to bitcoin, the world’s leading cryptocurrency. The good news is that the asset has recovered somewhat from its mid-May lows. The asset is no longer trading in the mid to low $20,000 ranges.
Bitcoin Has Gone Back Up… A Little
The bad news, however, is that bitcoin is still not in a stellar place, and it’s recently closed a roughly two-month period in which the currency repeatedly dropped. The asset went eight full weeks slipping into the darkness and losing value. This is the longest losing streak the digital asset has ever experienced.
At the time of writing, bitcoin has risen by close to ten percent. Bear in mind that this article is being written more towards the middle of May – right after the digital currency dropped to around $27,000 per unit, the lowest it’s been since 2020. However, now the currency has risen back above $30K, suggesting that perhaps some investors are getting their appetites for risky assets back.
Bitcoin is also being joined by some of the world’s leading altcoins. Ethereum, for example, rose about nine percent and is now trading for just over $2,000 (it was below this line previously). The currency had recently shed about 20 percent of its overall price. Cardano and Solana – two tokens stemming from the ETH network – are up 28 and 20 percent respectively, while Dogecoin – a popular meme token – is up by about 18 percent.
Despite all this, however, the currency is still well below the $45,000 mark it was experiencing last February as the war in Ukraine broke out and more than 50 percent below the $68,000 all-time high it reached six or seven months ago in November. Overall, the currency is experiencing the longest stretch of weekly losses in its 13-year history, and prior to 2022, the asset had not logged back-to-back losses like it has now.
Will the Market Continue to Go Down?
Susannah Streeter – senior markets analyst at Hargreaves Lansdown – explained in a recent interview:
Some traders may see the sharp fall this month as an opportunity to buy the dip at a time but, given the hugely volatile nature of the coins, the crypto house of cards could tumble further. This latest plunge in the wheel of fortune demonstrates that speculating in cryptocurrencies is extremely high risk and are not suitable for investors who don’t have money they can afford to lose.’
Much of the recent plunge is being attributed to a moment in time when Terra USD – an algorithmic stable currency – lost its peg to the dollar and fell close to a price of $0 along with its digital counterpart Luna. The ugly streak also seemed to make its way into Tether territory, as the popular stable coin saw itself trading for less than $1 for the first time.
