A Chinese crackdown on crypto mining led to a decrease of almost 50% in the value of Bitcoin. Its value fell to its lowest level since January. Ethereum, Ripple, Cardano, Dogecoin, and other major cryptocurrencies also took a significant hit. However, they still remain significantly up from their values at the start of this year.
Bitcoin fell below all support levels and closed the gap with the $30,000 mark. It prompted panic selling in the investors, and consequently, altcoins saw a major dip as well. Nonetheless, the market rebounded on Monday, moving bitcoin from below $32,000 to above $36,000. Elon Musk’s comments that he preferred cryptocurrencies to fiat currencies contributed to the rise in the value of Bitcoin.
Recently, the tech billionaire’s market-moving tweets have been both thanked and blamed for. Moreover, he argued indirectly with Ethereum co-founder Vitalik Buterin, stating “he fears the Doge”.
The market is still optimistic about bitcoin’s prospects and the direction of the market as a whole. According to a number of renowned analysts, this is just a regular market correction and there is nothing to fear about. Some analysts have argued that the bull market is “just warming up”, based on figures found by blockchain data firm Glassnode. On the other hand, users continue to double their initial investments on a yearly basis.
Is the dip over?
The last few weeks have been a rollercoaster for the crypto market. No one had predicted such a major sell-off in the market. Bitcoin recently topped the charts by securing an all-time high in the market. Doge, ADA, and XRP flew high over the last few months. But a sudden change in the market dynamics rocked the investing sector.
Initially, many analysts predicted that this is only a regular dip or bearish market. However, the market suffered three major dips and forced people to liquidate their assets immediately. The month of May has caused serious problems for traders and hodlers.
Another role was played by the comments and tweets of Tesla CEO, Elon Musk. He has had a fair share of a stint with Dogecoin and Bitcoin in recent times. His tweets have significantly influenced the trends of the market. He has been criticized by analysts and experts for manipulating and controlling the crypto market. Even in the last couple of days, his tweets have deteriorated market trends by a fair margin.