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Bitcoin Falls to the Lowest Point Since 2020

Author: Michael Smith
Michael Smith
All publications of the author

Bitcoin has taken a steep tumble on November 8th, when the cryptocurrency shrank by 12.6% following a merger proposal by Binance and FTX, some of the biggest crypto exchanges on the market. This marked the lowest Bitcoin has been this year, and ever since autumn 2020.

The fall came right after a sudden crypto rally that happened early this October, which saw a long-awaited period of growth for Bitcoin. It didn’t last for too long, although some say the growth can still rekindle when the current panic will exhaust itself. The estimations are pessimistic, though.

BTC hit its yearly minimum of $17,300 on Tuesday, although the final price for the day stopped at $18,300.

Background

The decline started with FTX. In particular, Binance has announced that they intend to acquire the non-American operations of this company. It was essentially a merger proposal, and it didn’t sit right with the FTX traders and FTT (FTX Token) investors, who immediately tried to bail.

The situation got so bad that the company temporary banned people from withdrawing their funds from the exchange. All of this naturally deteriorated the value of both the company and its equities. This led to a domino effect that eventually encompassed the entirety of the crypto market. It’s fascinating and terrifying how these things happen.

More Bad News

The incident isn’t restricted to the BTC market. Many big currencies and crypto-related equities experienced a similarly sudden fall in price on Tuesday. Ether fell by 18%, stopping at $1,316. It didn’t hit this year’s low point, but it came quite close. The stocks of many top crypto exchanges also fell dramatically.

One of the most prominent declines of the day happened to the FTT – the inner token of FTX, whose crash was estimated at over 70% in one day. Equities related to Binance, Robinhood, and Coinbase all suffered in the same timeframe, although some didn’t suffer as much as FTX.

This marks a massive recession for the entire crypto market, although by the time this article is posted it’s only been a day since the prices dropped. It’s currently unclear if the market participants will see it as a temporary decline in an otherwise bullish scenario (Bitcoin has been steadily growing for some time already) or as another misstep in a series of failures.

Tune in for crypto news this week to see where this gets us.

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Risk Warning: Your capital is at risk. Statistically, only 11-25% of traders gain profit when trading Forex and CFDs. The remaining 74-89% of customers lose their investment. Invest in capital that is willing to expose such risks.