Bitcoin Falls, Down in The doldrums after plummeting to $5,568
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Bitcoin Falls, Down in The doldrums after plummeting to $5,568

March 12, 2020      Prashant Jha

The elite cryptocurrency Bitcoin has fallen drastically and is experiencing a turbulent Thursday as another sell-off in the traditional market hits it hard. It went as low as $5,568, which it last witnessed in May 2019. It represents a massive drop of around 24% within 24 hours. However, it picked up the pace instantly, regained some ground and was trading at $6,069.73 at press time.

Bitcoin’s Fall could have been triggered by the ongoing turmoil in the traditional market creating a panic sell among investors. The traditional market be it elusive European equity market indices  Germany’s DAX, France’s CAC and U.K.’s FTSE 100 all of them witnessed a drop of six percent minimum at the time of writing. Asian equities also took a hit as Japan’s Nikkei index suffered a loss of 4.5%. A similar loss engulfed futures on the S&P 500.

The genesis of the current plight of these prominent exchanges and bitcoin was laid two weeks ago. However, after the hysteria that happened following Donald Trump’s announcement that he is banning most of Europe from travelling to America, further heightened and worsened the situation. Also,  investors eyes went gloomy when the additional fiscal stimulus to counterattack the deadly corona never reached fruition. 

As Stocks stumble and Bitcoin falls after the battering, eyes turned to the classic yellow metal gold, but even gold’s yellow chips are a bit down. It’s trading largely unbothered at $1,642 per ounce, after seeing a minuscule low of 12 dollars earlier.

The travesty that has befallen the traditional safe-havens is not bemusing given these institutions are milking out these assets to fund margin calls in the equity markets.

“ We started seeing institutional liquidity issues today. For the first time since the beginning of the bear market, neither US treasury bonds now gold managed to hedge an S&P decline.” Qiao Want, angel investor and Messari’s head of product said in a tweet on Thursday.

Infallible or Was Bitcoin’s Fall Inevitable?

Coronavirus was considered a boon and people expected bitcoin to blossom. However, that has not been the case lately and Bitcoin’s last 24 hrs slump is outlandish. What has agitated the situation further is that people are panicking and are now looking at it as a source of liquidity.

According to Arcane Research, the institutional investors are having a change of heart given the growing coronavirus fears. No longer is bitcoin being considered a hedge or a haven, but the instability lingering in the financial corner has turned it into a redeemable source of liquidity.

The Federal Reserve If reports are to be believed would cut down the rates further to lend legs to the crippling economy. However, so far these attempts have failed to provide any improvement on the dwindling economy. The pressure is mounting on bitcoin too, and right now the leading cryptocurrency is experiencing its own abyss and is in a shambolic state.

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Prashant Jha
Prashant Jha

An engineering graduate, Prashant focuses on UK and Indian markets. As a crypto-journalist, his interests lie in blockchain technology adoption across emerging economies.