Since Bitcoin is trading at around US$19,000, it indicates that BTC has lost over 70% of its value since its all-time highs in November 2021. BTC's actual resistance is the US$20k mark, which is also its 100 hourly simple moving average. Experts believe that if Bitcoin fails to clear the US$20,000 resistance floor and its 100 hourly SMA, its momentum could continue to slow down. The price's major support sits close to US$22,000, but unfortunately, the cryptocurrency is constantly rejecting this floor. Any more losses might send the price down to US$18k once again, and even below that! Until recently, Bitcoin was considered an important store of value that was immune to fluctuations in the mainstream economic and financial markets. But this is no longer the case. Today, Bitcoin and the broader crypto market are now majorly influenced by economic phenomena that reduce the importance of risk assets like inflation, stock markets, and Fed monetary policy. Experienced Bitcoin traders are no strangers to bearish market conditions and its volatility, but Bitcoin price fall is continually losing investor support because due to its inability to produce fruitful results. This article features the 10 reasons for the Bitcoin price fall and why it will reach rock bottom before 2022 ends.
Dozens of mainland Chinese cities, including Shanghai, are in covid-related lockdowns, and this is negatively affecting companies around the world. The Russia-Ukraine war is also costing the world billions.
Over 40 countries, including China, have either outright banned crypto or have cut off banking access to the ecosystem or prohibited cryptocurrency exchanges. It is one of the reasons for the Bitcoin price fall and why it will reach rock bottom before 2022 ends.
It has imposed a flat 30% income tax on crypto profits while disallowing any exemptions due to crypto losses. A 1% TDS is coming into force from 1 July, and a goods and services tax of 18% or more is also expected. Despite the taxes, the government has made it clear that crypto has not been legally recognized. This has had a huge negative impact on the Indian crypto ecosystem.
The first country to make Bitcoin legal tender has been unable to get its citizens to use it. And their Bitcoin Bond met with zero interest. It is one of the reasons for the Bitcoin price fall and why it will reach rock bottom before 2022 ends.
Examples – Ronin exploit ($615 million), Solana Wormhole exploit ($326 million), Beanstalk flash loan attack ($181 million), and the Qubit exploit ($80 million). These exploits and scams bleed investors and severely impact sentiment.
Crypto data firm CryptoQuant's BTC leverage ratio hit all-time highs in early January, meaning more investors were taking on risk in the crypto space. Just like in traditional markets, crypto investors will often use debt to finance purchases of futures. It is one of the reasons for the Bitcoin price fall and why it will reach rock bottom before 2022 ends.
This is due to many plagiarized works, fake collections, spam, frauds, rug-pulls, and wash trading. It is one of the reasons for the Bitcoin price fall and why it will reach rock bottom before 2022 ends.
The biggest problem the crypto markets face when leveraged investors liquidate a large portion of their assets is the overall liquidity of the markets. Unlike in the stock market, there aren't always a bunch of buyers waiting to snatch up unloaded coins. This is part of the reason why crashes tend to occur over weekends for crypto. There are fewer investors tuned in to buy when a bunch of coins is sold.
Terraform Labs is the organization behind UST, LUNA, and Luna Foundation Guard. This selling pressure has also dragged the entire crypto market down. It is one of the reasons for the Bitcoin price fall and why it will reach rock bottom before 2022 ends.
Yuga Labs, the project behind Bored Ape Yacht Club NFTs, had announced the sale of land NFTs of its Otherside Metaverse. This had pumped the prices of ApeCoin. But the land NFT sale happened at a flat rate of 305 ApeCoin tokens per plot instead of an auction-style sale. This led to a collapse in ApeCoin prices.
Join our WhatsApp Channel to get the latest news, exclusives and videos on WhatsApp
_____________
Disclaimer: Analytics Insight does not provide financial advice or guidance. Also note that the cryptocurrencies mentioned/listed on the website could potentially be scams, i.e. designed to induce you to invest financial resources that may be lost forever and not be recoverable once investments are made. You are responsible for conducting your own research (DYOR) before making any investments. Read more here.