Since 2009, the virtual currency known as Bitcoin has received at least 458 “dead” marks. BTC, however, consistently showed itself to be more than alive.
The term “crypto” was in high demand last year since the cryptocurrency business as a whole was booming.
However, given that cryptocurrencies have entered a severe bear market, it currently seems that the success of digital currency has diminished. According to a recent Bloomberg report, even seasoned investors are already leaving the market, despite the fact that short-term investors dumped their shares quickly.
The price of Bitcoin (BTC) fell to as low as $17,000 during the most recent drop, the lowest level since late 2020. According to statistics from Google Trends, “Bitcoin is Dead” is starting to trend once again, reflecting the prevailing atmosphere of uncertainty among investors in the cryptocurrency industry.
What led to the most recent Bitcoin crash?
Since its record high in November, bitcoin has lost about 70% of its value, but it all started in March when CNBC reported that the Federal Reserve had authorized its first rate increase in three years. That one act later proved to be a significant turning point, pushing the price of risky assets like Bitcoin lower. In the meantime, a string of additional occasions that soon came to pass, such as Russia’s invasion of Ukraine and the Terra crash, also contributed to the Bitcoin meltdown.
“A combination of macro headwinds, such as increased interest rates and geopolitical uncertainty, has triggered a broader market downturn that has caused a major delegating event in crypto markets. Specifically, the implosion of Terra and the following insolvency/deleveraging of Celsius and Three Arrows Capital, has forced the liquidation of large amounts of BTC, which caused a price crash.”
CEO of First Digital, a worldwide digital payments company, Vincent Chok stated that the collapse of the Luna Classic (LUNC) was the primary factor in the disaster. To Cointelegraph, he said:
“This is a typical market cycle event. Geopolitical strife was not the main cause, but rather the collapse of LUNC and the systemic concerns brought on by the substantial exposure to this token.
For hedge funds, the collapse resulted in margin calls and specified liquidity situations. Chok continued by saying that it is an inevitable aspect of the bull run and a component of the industry’s supercycle. He continued that sooner or later something has to be fixed.