Bitcoin Price Plummets To More Than Half Of What It Was Months Before

12/05/2022

As a cryptocurrency, Bitcoin is extremely volatile.

At one point, its price may be sky high. But suddenly, the price may drop tremendously.

This is what exactly happened.

The market value of Bitcoin has fallen by 50% since its peak in November 2021.

While the cryptocurrency market can be predicted by the movement of the few hoarders of Bitcoins who own many of the digital currency inside their wallet, this time, things are a little different.

It is caused by a few major chain of events.

Read: The Fall Of The Terra-Luna Cryptocurrency That Wiped $45 Billion In Just One Week

Bitcoin, May 12th, 2022.
Credit: Statista

In 2021, Bitcoin reached its all-time high for three times.

This happened in February 2021, April 2021 and November 2021. The first two were due to events involving Tesla and Coinbase, respectively, whilst the latter, was caused when Tesla’s announced that it had acquired $1.5 billion worth of the digital coin as well as the IPO of the U.S.’ biggest cryptocurrency exchange fueled mass interest.

In April 2022, things go south after a notable correction that happened following a speculation on government regulation.

Another reason, according to experts, was an electricity blackout in the Xinjiang region in China. This unexpected development led to a decline in the Bitcoin hashrate - how many Bitcoins are being mined – and potentially spooked investors into selling their assets.

The decline is also fueled by the fact that Russia is still invading Ukraine.

Bitcoin's decline also follows the downward trend in major Asian and European equities.

In short, the huge drop is caused by the slumping global equities that happened amid geopolitical tensions, and the lack of movements by cryptocurrency whales.

Read: Prices Of Cryptocurrencies Fell As Soon As Russia Started Invading Ukraine: 'War Is Bad'

Bitcoin

Bitcoin highest ever price since it was created by the anonymous Satoshi Nakomoto, was at around $69,000.

And this time, five months into 2022, the price plummeted to about half of that, at around $26,280.

In all, the cryptocurrency has a market capitalization of around $635 billion, and accounts for nearly a third of the $2 trillion cryptocurrency market.

It's worth noting that the fall isn't exclusive to Bitcoin.

Ethereum, the second-largest cryptocurrency, also fell.

This downward trend completely reverses the bull run that happened months earlier, at 2021, when the world was picking up its pace recovering from COVID-19.

Read: Big As Whale, Small As Plankton: Explaining The Cryptocurrency World That Has Animals As Names