From quite a while, many experts have speculated that a bitcoin price drop is possible for various reasons. Yesterday, bitcoin finally plunged below $7.8K and eventually settled around $7.4K. The bleeding stopped as quickly as it began and investors will most likely be cautious in today’s trading.
Interestingly enough, most experts predicted that this price drop should have come earlier. After all, ever since the 26th of September, bitcoin has been more or less continuously shifting between $7.8K up to the $8.3K mark. After failing to sustain itself above $8.3K, it was clear that the momentum was slowly fading.
This is not the first bitcoin price drop
There are a few reasons for yesterday’s price drop as this is actually the 9th time that bitcoin has dropped below $7.8K since September 24th. From a technical point of view, bitcoin’s market was already bear-biased in the short-term timeframe.
Huuuge #BTC long liquidation on Bitmex on that huge sell-off just now which is reportedly driven by a massive sale of 3600 BTC on @Bitstamp. Some reports this could have been an algo gone wrong! Every bid from $7800 to $6200 wiped out in less than 15 minutes. pic.twitter.com/jKQj0sFhii
— taiwandan (@taiwandan) May 17, 2019
Yesterday saw the liquidation of $200 million worth of leveraged longs at BitMEX. Additional data reveals that the price fell dramatically at Bitstamp shortly before the large price drops occurred at other exchanges.
Another likely reason for the price drop is Mark Zuckerberg’s appearance before Congress yesterday. As his hearing is heavily covered by mass media, it’s extremely possible that information is blown out of proportion and has a real downturn on bitcoin’s price.
As CoinStaker reported, Zuckerberg is testifying before US lawmakers about the political ads in Facebook, the wide spread of misinformation on the platform and the future of the Libra project.
The most unlikely reason is Google’s announcement about a quantum computing breakthrough. According to the limited information, a recent breakthrough has allowed on of the machines to carry out incredible tasks which would take most current supercomputers over 10 000 years to execute.
Quantum computers solving algorithms at such speeds could give investors a light spook as some might theorize that the bitcoin network will easily come under attack.
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