Bitcoin Falls Over $ 2,000 As Cryptocurrency Bulls Benefit From This Month’s Star Race Currency News | Financial and business news

• Bitcoin fell more than 10% on Thursday as cryptocurrency traders cashed in their Bitcoin holdings which gained 20% in value this month alone.
• The digital token looked set to hit a record high of $ 20,000 this week.
• After such a rapid rally, traders said a number of large investors had seen profits on their holdings – many of which could have been transferred to exchanges for a better price.
• “There is a growing sense that we are reaching a Bitcoin tipping point,” said one crypto trader. “In fact, we can expect a return to calm.”
• Visit the Business Insider homepage for more stories.

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Bitcoin slipped more than $ 2,000 on Thursday in its biggest single-day drop in nearly three months.

The price of the world’s largest cryptocurrency fell 11%, to $ 16,725, at 8.45am GMT. The price is still up around 21% this month and 138% year-on-year. It peaked at $ 19,497 on Wednesday, but failed to break the record of $ 19,666 set in December 2017.

The price correction can also be a function of a number of crypto traders moving larger volumes of Bitcoin to exchanges, where they can be more easily sold at a better price, when the token has approached the 20,000 mark. $.

“There is a growing sense that we are reaching a Bitcoin tipping point,” said John Kramer, trader at crypto trading firm GSR. “In fact, a cooldown is to be expected. But with more well-known fund managers and institutions re-examining their Bitcoin theses every day, it is getting harder and harder not to take the asset over. seriously.”

Kramer said that many investors feel that the stock market is totally separate from economic reality at this time. The S&P 500 hit record highs this week as cases of COVID-19 in the United States increased and nearly 2,000 Americans died from the virus every day. The potential returns from traditional markets are low, while the risks are quite high, he said.

Part of the rally in cryptocurrencies over the past few weeks is due to the fact that they had very little correlation with the economy in general, interest rates or even other asset classes, unlike stocks. , bonds, gold or oil.

“The stimulus response to the pandemic has fueled lingering concerns from several large asset managers over the devaluation of the US dollar, highlighting the limited supply of Bitcoin,” Kramer said. “The risk-return relationship for digital assets is now an attractive alternative that is not correlated to a broader macro and increases the diversification of a traditional portfolio.”

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Despite Thursday’s sale, Bitcoin could soon hit $ 20,000, according to Ki-Young Ju, creator of chain analytics company CryptoQuant.

“The average entry for all trades rose a few hours ago,” Ki-Young said in a Tweeter. “This indicates that the whales, relatively speaking, have deposited $ BTC on the exchanges. But long-term indicators on the chain indicate that buying pressure is prevailing. I still think we can break 20k in a matter of days.”

Other digital coins have also fallen alongside Bitcoin. Ethereum fell more than 13%, to around $ 491, and Ripple’s XRP fell 20%, to $ 0.49. Smaller “altcoins” have benefited from the same push towards cryptocurrencies. Ethereum is still up around 30% this month, while the value of XRP has more than doubled.

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