March 27, 2024
Latest Cryptocurrency News

Bitcoin Slumps to $27,600: The Biggest Single-Week Price Drop in 5 Months

The price of Bitcoin (BTC) slumped sharply over the past week to nearly $27,600, a more than 9% fall. It was the heaviest weekly percentage loss of BTC since early November 2022.

The significant slide in the Bitcoin wiped out its gains in early April of over $30,000, and now the price is moving below the previous month’s closing value of nearly $28,500.

Reportedly, a strengthening of the US dollar ($) triggered Bitcoin’s fall since the American central bank is looking to hike the benchmark interest rate by a 25 basis point in May 2023. A higher-performing dollar will likely make non-yielding assets like cryptocurrencies less attractive. 

Another issue cropping up in the US economy is the debt ceiling crisis. The US Treasury holds massive amounts of debt, where the current debt limit exceeds the threshold of $31.4 trillion, with nearly $31.46 trillion taken as loans already.

Without any promising signs on the monetary liquidity front, Bitcoin kept going down over the past week after its sharp decline on Monday, dragging down other crypto assets (large-cap).

Data shows the total market capitalization of all other cryptocurrencies slipped by 2.2% to $1.24 trillion during the same timeframe. For example, Ethereum (ETH) suffered a loss of 1.7% on a 24-hour scale to trade nearly $1,920, down 4.5% on that week.

In the current scenario, Bitcoin is still heavily affected by the macro mood, mainly driven by monetary liquidity expectations.

Investors still perceive Bitcoin as a risky asset and may feel the selling pressure in the case of an equity price breakout at any point. In 2011, the risky assets had been at the receiving end during a similar debt-ceiling deadlock that eventually led to the US losing its triple-A sovereign credit rating.

Although several advocates of Bitcoin still believe that its price can get boosted if the confidence in the American economy wanes, currently, the impulse reaction of a worldwide economic crisis has made things seem uncertain in the markets.

Image by frimufilms on Freepik

Related posts

Gitcoin’s Transfer Error Results in $460K Sent to Unrecoverable Address

Bran Lopez

SEC Charges Stoner Cats 2 LLC for Unregistered NFT Securities Offering

Harper Hall

A Decade Behind Bars: Silk Road Creator Ross Ulbricht’s Ongoing Struggle

Robert Paul

This website uses cookies to improve your experience. We'll assume you're ok with this, but you can opt-out if you wish. Accept Read More