Bitcoin 3-Day Chart Indicates A Recurrence Of The March 2020 Crash
According to Trading Display, the world’s most popular cryptocurrency, Bitcoin, hit a new low of $20,828 at the beginning of the week. Due to this new pricing, BTC lost 16.54% of its value in less than a day – almost $5,000 in value.
Although it is the largest and most well-known cryptocurrency, Bitcoin is notorious for its huge rises and equally dramatic declines. For example, BTC rocketed to an all-time high of over $69,000 in November 2021 and then fell to just under $30,000 by the start of 2022.
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Bitcoin’s value peaked above $30,000 on June 1, 2022, but sank below it the following day. It is currently trading below $22,000. This drop is linked to TerraUSD, a stablecoin, which breaks its $1 peg and Luna then drops.
In addition, it reflects the global financial uncertainty caused by rising inflation as investors look to sell “riskier assets” such as cryptocurrencies.
The Bitcoin 3-Day Chart Indicates the March 2020 Crash
The 3-day Bitcoin chart indicates a repeat of the March 2020 crash, based on the current state of the BTC market. Bitcoin’s popularity as a safe haven started to wane in March 2020. It had lost half of its value in just two days.
After opening the week above USD 9,000, the cryptocurrency suddenly dropped below USD 4,000 on March 13, 2020. However, by the end of the US markets, it had returned to around USD 5,400.
Bitcoin is currently trading below $22,000 on the daily chart | Source: BTC/USD chart of TradingView.com
Before the March 2020 crash, Joe DiPasquale, CEO of BitBull Capital, said the global coronavirus pandemic has caused investors to turn their money into cash as a form of protection.
He further added that Bitcoin’s potential as a safe haven is being questioned because of this sharp drop. But thinks it’s too early to look for links between Bitcoin and other asset classes.
Reason Behind Bitcoin Plunging To New Lows
One contributing factor to bitcoin’s new lows is the halting of all withdrawals, transfers and swaps between accounts by Celsius.
Celsius, a DeFi platform and one of the largest cryptocurrency lenders, is a major cause of distrust in the Bitcoin market.
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The network announced that they had interrupted withdrawals, swaps and transfers between customers via Celsius. This announcement was made in the early hours of June 13, after Bitcoin fell below $24,000 and the entire crypto market lost about $250 billion in just seven days.
If the company Announcement stated:
Due to extreme market conditions, we are announcing today that Celsius is pausing all withdrawals, swaps and transfers between accounts. We are taking this action today to put Celsius in a better position to meet its withdrawal obligations over time.
Featured image from Flickr and chart from TradingView.com