The world’s most popular cryptocurrency has fallen to a more than a one-year low on Wednesday, breaking through the key support level of $6,000. The price dropped by almost 11 percent in a single day of trading.
The digital currency’s price recovered slightly on Thursday, trading at $5,680.01, down over $800 over the last 24 hours after a relatively calm few months.
“The market is trying to find the bottom,” Michael Terpin, a San Juan, Puerto Rico-based partner at Alphabit Fund, said. He told Bloomberg that “People who are chartists look at historical patterns, and they note there’s one last final capitulation drop to get the last people fleeing out of the market.”
After nearly touching $20,000 in December 2017, bitcoin’s value has nosedived in volatile trading over the following months. The virtual currency has enjoyed a period of relative stability since early September, hovering between $6,000 and $7,000.
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Bitcoin’s market capitalization fell below the $100 billion mark on Thursday, to $98.7 billion, according to CoinMarketCap.com. That’s a level not seen since October 2017.
The sharp fall in bitcoin’s price was accompanied by steep sell-offs in other cryptocurrencies and digital assets as well. BitcoinCash was down more than 12 percent, at $453. The second largest cryptocoin, ethereum, dropped to a two-month low, trading at $180 on Thursday.
The total cryptocurrency market cap is down more than 70 percent from its highs earlier in 2018, at just under $185 billion.
As bitcoin plunged below $6,000, it’s possible that stop loss orders were automatically going into effect and investors were “trying to play the breakout,” eToro Senior Market Analyst Mati Greenspan told CNBC.
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He added that another “contributing factor is the selloff in tech stocks, which could be having a spillover effect into crypto markets.”
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