The the perfect storm that impacted cryptocurrencies in recent weeks, he seems far from giving up. Worse, new elements appear every day that, far from helping to restore calm, fuel the doubts of investors and analysts.
Bitcoin: Factors That Alert Cryptocurrency Investors
In the last hours, one of the factors that can prevent his recovery they face the fear of protests in China due to restrictions related to the “zero Covid” policycausing a global wave of risk aversion that slowed the recovery of Bitcoin and the rest of the cryptocurrency market.
There is a risk that China’s policy of restricting mobility will hinder the stabilization of domestic demand, Katrina Ell, a senior economist at Moody’s, said on Bloomberg Television.
The reason for the fear is that Such disruptions could lead to “further supply chain constraints worldwide,” added Hayden Hughes, CEO of Alpha Impact.
This situation can cause it is more difficult for central banks to control inflationwhich would cause interest rates to rise further, reducing the appeal of cryptocurrencies.
What do cryptocurrency gurus think about Bitcoin?
Added to this is the opinion of emerging markets guru Mark Mobius, who predicted even more significant falls in the most popular cryptocurrencies. Indeed, Mobius, who is one of the founders of Mobius Capital Markets, said in an interview that your next bitcoin goal is $10,000, added that it would not invest its own or its clients’ money in digital assets because “it’s too risky.”
According to experts, there are two main factors slowing down the growth of Bitcoin.
The veteran executive was surprised that Bitcoin was able to hold prices despite the huge uproar caused by the FTX bankruptcy.
His prediction is not without basis. The options data from the Deribit company shows many Bitcoin futures contracts sold at the end of December at $10,000. These prices, called open interest in slang, indicate that investors are determining these bitcoin prices between now and the end of the year.
However, Mobius assured that “cryptocurrency is here to stay there are a few investors who still believe in him.” “It’s amazing how bitcoin prices have held up despite the FTX collapse,” he added.
In fact, Bitcoin has fallen to the 16,000 mark in the past few hours, after patting a retracement to $17,000 following a strong sell-off that triggered the collapse of FTX. At the current price, Bitcoin is back to the level it was two years ago, and Ether is below $1,200.
“Technically, we have moved into another range bounded by $15,500-$17,000.” Volatility eased again and spot trading volumes declined. Only after breaking the 17,500 area, we could think about a bull bounce with a $20,000 target,” says eToro analyst Javier Molina.
The analyst adds that “the lows marked below 15,500 represent the last valid support. Losing that area opens the way to 13,000, Therefore, the warning to maximize risk control remains strong,” he adds.
While investors expect Bitcoin to reach $10,000, Ethereum is also falling due to uncertainty.
Cryptocurrencies: Fear also reaches the ether
The retreat of investment coincided with fears that FTX issues cross over to other platforms cryptocurrencies, as is the case with Genesis. The fears reflect the nervousness of a shaken market, where any rumor can quickly turn into a wildfire. This is what happened this Monday with the price of ethereumthe second-largest cryptocurrency in the market, which has been rocked by falls and volatility.
It all started with a joke on Twitter that falsely claimed that there was a break in parity between ethereal and wrapped ether. This last coin must be backed by Ether at a ratio of 1:1 and is what was questioned with a joke.
Under normal circumstances, this would have been nothing more than a sick joke, but fear spread like wildfire. A loss of parity would have meant the insolvency of the coiled ether, something similar to what happened with luna and terra.
Actually, it was all smoke. Markus Thielen, head of research and strategy at cryptocurrency firm Matrixport, said he is “not too worried” about wrapped ether because it relies on the automatic execution of smart contracts. This means that no person or entity can manipulate the quote.