Update: The price of Bitcoin has since stablized at just under $50,000, where it has hovered for much of the day. Some commentators have linked the dip to news that US President Biden is planning to raise taxes on investment income for the richest Americans.
After a period of steep growth, the price of the world’s largest and most famous cryptocurrency is in a downward spiral.
Bitcoin, which is famed for its extreme volatility, reached a new record price of roughly $64,800 per unit last week, but has now fallen to circa $48,000.
At the time of writing, the digital currency has recorded losses of 10% in the last 24 hours alone, wiping more than $100 billion off the market capitalization, per CoinMarketCap data.
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On its current trajectory, Bitcoin is set to register its steepest weekly slide since February, when the price per unit slid from around $57,000 to a trough at $45,000.
Although the cause of the latest dip is not crystal clear, and is likely linked to a host of interconnected factors, some have speculated a rumored crackdown on crypto laundering among US financial institutions could have acted as the trigger.
As is often the case, the shift in the price of Bitcoin has also been mapped across the wider cryptocurrency industry. Almost all popular altcoins have suffered a dip in price in the last 24 hours, with Ether falling by 10%, XRP by 19% and Cardano by 15%.
While a steep drop in the price of cryptocurrency will leave people wondering whether the bubble has burst, as it did so spectacularly in 2017, some commentators claim this is just a temporary dip and remain bullish about Bitcoin’s prospects.
“On-chain data suggests we’re still in a long-term bull market,” Ki Young Ju, CEO at Cryptoquant, told CoinDesk. “In the short term, we might have a correction and going sideways in a broad range since the market is overheated among retail investors.”
In other words, Ju believes the price of Bitcoin will continue to climb in the long-term, despite setbacks such as this one.
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