Bitcoin Slips Down Today, Can Fall Further Sharply: Analyst

Cryptocurrencies are one of the highest volatile assets globally. Bitcoin, the largest cryptocurrency depending on its market capitalization slips down again today on June 22, 2022. It stood at Rs. 15,86,036.23 by falling 1.92%, till 5.38pm, Coordinated Universal Time (UTC). The past two weeks have been a time of massive loss for the overall crypto market due to a high sell-off.

What do analysts think?

Many analysts are expecting that the asset can fall sharply further. Ian Harnett, co-founder and chief investment officer of Absolute Strategy Research told CNBC, "We would still be selling these kinds of cryptocurrencies into this environment." CNBC reported that Harnett thinks, Bitcoin can fall as low as $13,000 - an almost 40% drop from current levels. Harnett added that "past crypto rallies show bitcoin tends to fall roughly 80% from all-time highs. In 2018, for instance, the cryptocurrency plummeted close to $3,000 after hitting a peak of nearly $20,000 in late 2017."

The crypto market globally is much under pressure as the major economies are increasing the interest rates, to control the climbing inflation rates. The US and the UK are facing 40 years high inflation rate at present, which is concerning the economists.

Bitcoin historical price chart

The Bitcoin market along with other cryptos surged sharply since Mach, 2020, when the pandemic hit the globe. Bitcoin stood at around Rs. 38,2016 on March 13, 2020. During April and November 2021, the crypto went up to its all time high levels due to the Covid-waves. On April, 2021, Bitcoin closed at around Rs. 44,82947, and on November 12, it closed at around Rs. 47,87818. However, 2021 has been a highly volatile year for the asset. Although Bitcoin has gained sharply by around 912% in the past 5 years, considering long term investment, this year, Bitcoin has mostly seen a downward trend, as the pandemic came under control.

Due to worries about volatility and low earnings in the assured income options, investors flocked to Bitcoin since 2020. The assets thrived because of the 'ultra-loose monetary policy' by major economies and interest rate reduction. However, as the interest rates are rising now, in the US and India, along with other economies, the crypto market came under pressure.