According to Reuters, the value of the most popular cryptocurrency, Bitcoin, fell on Friday, January 22 by 5% to $ 28,800, which is the lowest in the last three weeks. By the middle of the day, the price evened out somewhat and hovered around $ 31,000.
Market participants warned of a correction in value after Bitcoin hit $ 40,000. Representatives from Flipside Crypto said that active Bitcoin accounts are approaching record highs of the end of 2017. This could be a sign that some holders are planning to sell Bitcoin.
Less than 2% of accounts own 95% of the Bitcoin supply, so a few large trades can have a significant impact on price. During the week of January 18-24, Bitcoin lost 11% of its value. The last time such a weekly drop in the price of cryptocurrency was recorded in September 2020.
Investors interviewed by the agency name two base reasons explaining the current fall in the price of the main cryptocurrency:
- The first is of a short-term nature, as many owners were afraid of the price jump to $ 42,000, in which they saw signs of a bubble, and decided to get rid of the cryptocurrency before it depreciated at all.
- The second is long-term and related to the expectations of regulatory intervention in the cryptocurrency market. So, on January 21, in the US Senate, hearings were held on the threat of using cryptocurrencies in financing illegal operations.
In 2020, the price of bitcoin increased by 700%, and back in March last year, for one bitcoin was given only $ 3,850.