Bitcoin’s (BTC) price falls back below $30,000 after wild trading week.
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Bitcoin (BTC) is constantly falling.
Bitcoin plunged 30% to near $30,000 at one point on Wednesday, continuing a major sell-off in the cryptocurrency markets that began a week ago.
The digital currency hit as low as $30,001.51 as the selling intensified Wednesday before paring some of those losses. The cryptocurrency hasn’t traded at those levels since late January.
Bitcoin rebounded as the day went on, was down 12% to about $38,205.49 shortly after 3 p.m. ET. At its intraday low, the cryptocurrency’s loss for the past week was more than 40%.
Read People are targeting Elon Musk.
The sharp drop means bitcoin had temporarily erased all its gains following Tesla’s announcement that it would purchase $1.5 billion worth of the cryptocurrency. It was also down more than 50% since hitting a record high of $64,829 in mid-April.
Other cryptocurrencies also plunged on Wednesday. Ether, the digital currency that powers the Ethereum blockchain, was down more than 22% at $2,620.97, according to Coin Metrics. Dogecoin, a cryptocurrency that started as a joke and talked up by Tesla CEO Elon Musk, fell 25% to less than 36 cents. Both had substantially larger losses earlier in the session.
Musk did suggest that the automaker was not selling its existing bitcoin on Wednesday. He was saying with emojis on Twitter that Tesla has “diamond hands.” That tweet was published near bitcoin’s lows for the day.
The crypto market was also affected this week by leading stable coin issuer Tether, which revealed a breakdown of its reserves for the first time. It came as part of the firm’s efforts to comply with a settlement agreed to with the New York Attorney General’s office (NYAG) after the prosecutor investigated it and its sister company Bitfinex over the cover-up of $800 million in losses.
The data provided does not mention any independent review by an accounting firm and shows that the bulk of its reserves are cash, cash equivalents, or short-term deposits. Its reserves also include secured loans, corporate bonds, and other investments.
Read Elon Musk has its own cryptocurrency.
The Bottom Line
On Tuesday, China banned financial institutions, including banks and payment companies, from providing cryptocurrency transactions and warned investors against speculative crypto trading.
One Twitter account every crypto holder follows is Tesla CEO. A tweet by Musk saying Tesla will no longer accept Bitcoins started the sell-off in the crypto market. He clarified in another tweet that he remains a strong believer in crypto. However, it doesn’t seem to impress Bitcoin holders, and it has been falling in price since then.