Bitcoin (BTC USD) Cryptocurrency Price Selloff Was a Long Time Coming

Table of Contents Ulrik Lykke, executive director at crypto hedge fund ARK36Felix Dian, founder of

Bitcoin has rewarded investors with massive gains all year, but now the cryptocurrency’s famous volatility is back.

The token plunged below $50,000 in Friday trading for its worst week in almost two months as a proposed tax hike for wealthy Americans intensifies an industry selloff.

While the digital token is known for its big price swings, this latest bout has been particularly head-spinning after the all-time high notched on April 14.

Still, talk to investors and analysts and many will say it was a long time coming — with last week’s rally in the satirical Dogecoin and the eye-watering valuation for Coinbase Global Inc. clear signs of market froth.

Here’s what market players are saying about the crypto slump. Comments have been edited and condensed.

Ulrik Lykke, executive director at crypto hedge fund ARK36

“Throughout April, the markets have been slightly overheated due to a large number of margin and leveraged traders. This caused a runup and the correction was only to be expected. In addition, traders’ anxiety and the overall emotional nature of the crypto markets also may have played a role.

“Notably, though, the price of Bitcoin fell only 25% from the recent all-time high and there are reasons to believe the overall trend will remain bullish unless the price drops below $40,000.”

Felix Dian, founder of crypto investment fund MVPQ Capital

“Looking at the previous bull cycle (2016/17), there have been quite a few occurrences when Bitcoin loses momentum and dips below the 100-day moving average. This one was overdue.

“We are actually seeing record subscriptions into our fund this month, from institutional family offices, with many willing to use this as an opportunity to add. Ultimately, strong hands buying will meet the lack of available liquid supply of Bitcoin, triggering a squeeze and further down the road a new retail FOMO wave.”

Jeffrey Halley, senior market analyst for Asia Pacific at OANDA

Leave a Reply

Your email address will not be published. Required fields are marked *