Just over the span of two days, crypto market has plunged to $21 billion as Bitcoin lost over 10 percent, moving closer to its yearly low. On September 6th, the price of Bitcoin dropped by more than 10 percent within just one hour. The crypto currency has been on continuous fall ever since then. Other tokens decline even farther then they did in April and June, losing over 10 percent against Bitcoin.
On September 6th, crypto market demonstrate one of the steepest declines in the past three years, losing around $40 billion investment in less than 48 hours. Crypto market is fragile and often show volatile nature but this drop was spanned over a very short period of time. In Aug, crypto currency faced a steep but it took it almost a week to exhibit a significant drop. Prior to Wednesday, the Bitcoin and other coins exhibit a stable trend which was rare but good news for the crypto investors.
Factors behind the market crash
ThinkMarkets chief market analyst Naeem Aslam said:
“Speculators have gone crazy and they are trying to squeeze as much blood out of this trade as they can. Bitcoin hasn’t changed what it was since last December, so what is the panic?”
He insist that Bitcoin trend has not changed since December 2017, when crypto market achieved a $900 billion valuation and initiated rapid decline. Experts suggest that it is difficult to exactly pinpoint the reason behind the fall of the market.
On September 6, Goldman Sachs delayed its idea to open Bitcoin trading desk to facilitate rising demand from retail traders and investors. Although the idea wasn’t dropped completely, it did effect the market. Hours after the statement was released, Goldman Sachs, personally reports that the institution is pivoting away from the Bitcoin trading desk operation, as “fake news”.
Cryptocurrency technical analyst Uzi don’t consider Sachs as the sole cause for the drop. He thinks that Bitcoin was already facing resistance over $7,000. Uzi also noted that the Bitcoin market is still generally illiquid, and is still not ready to support the big demand from the big investors. Most short or long contracts around Bitcoin and other crypto currency market are done by individual investors.