Investors on Wednesday decided that bitcoin wasn’t such a good deal after all.
Recently, the largest cryptocurrency by market capitalization traded just below $30,000, a more than 6% drop over the past 24 hours that undid much of the gains made during the U.S. holiday weekend surge. As recently as Tuesday morning, Bitcoin was trading over $32,000 as markets responded to the relaxation of COVID-19 restrictions in China and the faint possibility that the U.S. central bank might relax its monetary hawkishness much later this year.
On Wednesday, Ether went down over 7% over the same period, trading at about $1,800. Other major cryptocurrencies sank lower with Luna Classic (LUNC), the new name for the original LUNA on the Terra protocol, falling 61% at one point. SOL and ADA both declined about 12%, while DOT was down roughly 9%.
“Bitcoin’s price action today is not entirely surprising,” Joe DiPasquale, the CEO of crypto fund manager BitBull, wrote to CoinDesk. “Not only is it facing pressure from traditional markets, it has also been struggling to breach the resistance zone between $31K-$32K, resulting in a breakdown from the range it set over the weekend.”
Bitcoin closed May, well in the red, although it outperformed altcoins. Still, BitBull’s DiPasquale was unconvinced that Bitcoin could turn upward quickly. ”Moving forward, Bitcoin will need to see significant buying activity and a major sentiment shift for any hopes of a quick reversal,” he wrote.