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Bitcoin Price Trades Lower But Here’s Why That’s Temporary And the Rally is Still in Play

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author imageArslan Butt Last updated:

Bitcoin price failed to extend its 2-week winning streak and slipped below the $21,000 mark. BTC had achieved its highest level since mid-September earlier Wednesday, trading as high as $21,602 before retreating to the $20,700 mark. It had fallen 2% on the day.

The reasons for its ongoing decline could be attributed to a variety of factors, including a risk-off mood in the financial market and the US charging crypto exchange Bitfinex $700 million in money laundering. Furthermore, the recent concerns about Genesis Global Capital, which prepares to file for bankruptcy, intensified the downturn in cryptocurrency prices.

Besides that, the poor US data have also played a huge role in undermining the cryptocurrencies by fueling the concern of an increase in interest rates. According to data released on Wednesday, manufacturing production in the United States had its worst decline in almost two years in December, while retail sales in the country fell by the most in a year.

On the positive side, broad-based US dollar weakness helped the cryptocurrency market limit its deeper losses. Furthermore, the losses were capped by the most current statistics, which show that major investors, known as “whales,” are not selling their holdings.

Risk-off Mood In Crypto Market; Bitcoin Price Underpins

The global cryptocurrency market failed to prolong its long upward rise, falling to $969 billion as a result of the US ban on the Bitzlato exchange. The global crypto market capitalization has declined about 4% in the last 24 hours, to $969 billion from $999 billion, according to the latest available estimates.

Also, the crypto market has been hit hard by the bad news from the US and the increased likelihood of interest rate hikes.

Considering that industrial output and retail sales decreased in December by 0.7% and 1.1%, respectively, month over month, the US economy may already be in a recession. The Producer Price Index (PPI), which had previously risen at 7.3%, now rose at a slower annual rate of 6.2%.

However, it indicates a reduction in purchasing power, which badly impacted the financial markets.

Genesis Global Capital Bankruptcy

Another major factor weighing on the cryptocurrency market is the announcement that Genesis Global Capital, an institutional cryptocurrency brokerage whose lending unit, is preparing to file for bankruptcy.

It is also worth noting that Genesis is in private discussions with several creditors. In the meantime, the company has warned that it may file for bankruptcy if it cannot obtain enough money.

Genesis has been desperately trying to find new financing or work out a solution with creditors ever since the fall and bankruptcy of the cryptocurrency exchange FTX in November. Notably, the institutional lending department of the firm had to stop redemptions and new originations as a result of FTX’s demise.

Meanwhile, the parent company, Digital Currency Group (DCG), had been under pressure to pay back $900 million in locked deposits. All of these factors are damaging the crypto industry.

US Crackdown on the Bitzlato; Weighting on Bitcoin Price

Bitzlato Ltd. has been accused by US law enforcement agencies of being involved with money laundering and its founder was detained in Miami. This news is affecting cryptocurrency prices in a negative way but other factors have also played their role in such impacts.

According to Deputy Attorney General Lisa Monaco during a news conference, the Hong Kong-based platform Bitzlato has been effectively shut down and its creator Anatoly Legkodymov has been placed in American custody. This will prevent Bitzlato from providing services to criminals with ties to Russia.

Want to know what’s going on with the Dollar?

The US dollar failed to make a stand against its losses on the economic front and remained well-offered around 101.920, but it was pressured by dismal US economic statistics that increased fears about the US economy.

However, the U.S. economy is losing pace, as evidenced by poor data that caused the dollar to decline on Thursday. Retail sales in the United States plummeted by the most in a year in December, while manufacturing production had its greatest decline in almost two years.

The decline in bond rates led to a dramatic decline in bond rates, which lessens the appeal of dollar-denominated bonds and contributed to the dollar’s losses.

Bitcoin Price

Bitcoin has had a steady rise this year and has reached an all-time high, with an average value of $20,792. The trading volume of Bitcoin is $29 billion. Although its value has fallen by 2% in the previous 24 hours, it is still the world’s most popular cryptocurrency.

Bitcoin, now in its 7th year, has become the market leader with a current market cap of $400.6 billion.

BTC

Bitcoin Price Chart – Source: Tradingview

Despite being bearish all day, Bitcoin has gained support near $20,600 and the closing of candles above this level has triggered a buying trend. On the upside, Bitcoin’s immediate resistance is at $21,650 and $22,500 levels.

Bitcoin has lately experienced a minor bearish correction, however, it is still worth investing in. Moreover, there are some other crypto coins that could be wise to buy now.

Bitcoin has recently experienced a minor correction, but it is still worth investing in. Here’s a crypto coin that’s worth watching.

Meta Masters Guild (MEMAG)

Meta Masters Guild is a mobile-focused gaming guild that will produce a variety of games on the web, with its debut game coming out in Q3 2023. Including items worth voting and staking, the native tokens are used for buying third-party products and NFTs.

Meta Masters has raised over $682,832 in pre-sales of their RPG in the last 24 hours. With this rate of growth, there is growing confidence in the market that MMG’s gaming platform will be profitable.

Those willing to invest in the MEMAG Sale should know that there are seven stages and the current phase offers a MEMAG for only $0.007. It won’t be around for too long, so get on this now.

This is expected to skyrocket within the next three days, so don’t waste a second and buy it before it’s too late!

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  This article was written for Business 2 Community by Arslan Butt.
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Author: Arslan Butt

Arslan is a professional live webinar speaker and derivatives (cryptocurrency, forex, commodities, and indices) analyst. Arslan holds an MBA in Finance, and an MPhil in Behavioral Finance.
Arslan brings a broad range of skills to help beginners evaluate financial data and investment trends, carry out technical analysis, fundamental analysis, and …

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