The Bitcoin (CRYPTO: BTC) price isn’t exactly rocketing back to new highs after the horror week just past.
But the world’s biggest token by market cap has stabilised, at least.
At the time of writing, the Bitcoin price stands at US$20,401 (AU$29,408). That’s just about where it was trading at this time yesterday, after hitting an overnight high of US$21,620, according to data from CoinMarketCap.
Like we said. Not shooting the lights out. But still some 17% above the US$17,709 lows the token hit on Sunday, its lowest price since 2020.
Why did the Bitcoin price tumble last week?
Bitcoin has been under pressure amid rising interest rates that have driven other cryptos, like the TerraUSD stable coin and its supporting token Luna, over the edge.
The end of historic low rates has seen most risk assets — think high-growth tech shares — sell off sharply.
Last week, the tech-heavy Nasdaq dropped 5%, despite Friday’s rally.
The Bitcoin price fared even worse, with Glassnode reporting that crypto investors’ realised losses on their Bitcoin holdings hit a record US$7.3 billion over the week.
Now what?
Looking ahead, the wider crypto market is unlikely to shake off its notorious volatility any time soon.
Feroze Medora, director of APAC trading at Cameron on the Gemini crypto platform, said (courtesy of Bloomberg), “A toxic mix of bad news cycles and higher interest rates has hurt the crypto market and we can anticipate more volatility in the upcoming weeks.”
Glassnode noted in a report that fewer forced sellers in the months ahead could offer some support to the Bitcoin price. “With forced sellers appearing to drive much of the recent sell-side, the market might begin to eye whether signals of seller exhaustion are emerging over the coming weeks and months.”
But any sustained relief rally looks to be some way off yet.
Discussing the recent Bitcoin price moves, Katie Stockton, founder of Fairlead Strategies, said (quoted by Bloomberg):
It’s a very natural place to see some stabilisation, a kind of relief rally. We do think that relief rally would be muted, however, just given the downside momentum really across the board.
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