It is safe to say the Bitcoin price crash wasn’t something most people had expected. Although all financial markets need healthy corrections after extended periods of steady gains, people assumed the Bitcoin markets would be somewhat immune to this trend. The reality is very different, although there are some oddities about this sell-off which raise questions. For now, it seems all markets are slowly recovering.
Bitcoin Price Rollercoaster is Back on Track
No one likes to see the Bitcoin price go down by 25% in a matter of hours. This trend started materializing last night and continued all the way through to this morning. Even now, the Bitcoin market remains extremely volatile, as any sudden gains can easily be pushed down again. How all of this will play out is incredibly difficult to predict. It seems safe to assume a temporary bottom has been reached, though.
So far, it is still unclear what triggered this massive shift. With the Bitcoin price dropping from US$17,000 all the way to US$12,961, it is evident some people panicked for no good reason. A healthy correction is long overdue for Bitcoin, but it’s always a bit scary when it materializes out of the blue. Ever since the low was reached, we’ve seen the Bitcoin price mount a comeback toward US$14,000 again. These markets are always incredibly fun to keep an eye on, as no one knows how things will play out.
What is questionable is how all Western exchanges partook in this massive Bitcoin price crash. The BTC price in South Korea, on the other hand, hasn’t dropped below US$17,000. Although there’s always a gap between South Korean and Western exchanges, Bitcoin lost almost three times as much value in the West than in Korea. Such discrepancies always paint a worrisome picture. At the same time, it’s good to see the Asian markets weren’t the culprit for this major shakeup. That situation was very different when China was still a big factor.
Thanks to US$18.78 billion in 24-hour trading volume, Bitcoin has set a new volume record. In times like these, it’s always important to see the bigger picture. While most of this volume was driven by people liquidating BTC due to mass panic, it seems the momentum is turning in favor of the world’s leading cryptocurrency once again. A lot of people who panic-sold their Bitcoin and altcoin holdings will have to spend a lot more money to buy back in, by the look of things.
Bitfinex still sees the most Bitcoin trading volume of all the exchanges. It also values Bitcoin the lowest of all exchanges right now, for some reason. On Bitfinex, one BTC is worth US$13,600, whereas GDAX trades it at US$14,115. It seems all USDT markets and Bitfinex’s own USD markets are the only ones which trade Bitcoin at such a low price right now. Explaining that situation is pretty much impossible right now, but it’s evident these particular markets are dragging down all cryptocurrencies as we speak.
How all of this will play out for the Bitcoin price remains to be seen. A slow and steady recovery will eventually push the Bitcoin price back over US$15,000 before the year is over. The only question is whether or not we will see more market manipulation in the coming days. This dip allowed a lot of people to buy cheaper Bitcoin, which could help even out its distribution a bit. For the time being, the recovery process is shaping up nicely, but there may be a lot more volatility to contend with.