Bitcoin Price Hits Late-2020 Levels As Crypto Market Suffers Fresh Inflation

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The latest news on the Bitcoin price is not good for investors. The cryptocurrency is falling back to its late-2020 levels after reaching its all-time high in late December. The price/network ratio is back to 2017 levels, and it is now expected to hit late 2020 levels. This is bad news for investors, as it means that more capitulation is yet to come. However, long-term holders of Bitcoin have often benefited from its bottoms. bitcoin price hits late-2020 levels as crypto market suffers fresh

The cryptocurrency has also been suffering from high inflation. Central banks have been trying to fight high inflation by raising interest rates, which make riskier investments less attractive. On Friday, the U.S. inflation index hit 8.6%, and this has affected bitcoin prices. As a result, the price of Bitcoin has dropped below its November highs. This is the worst drop since 2011.

Bitcoin’s recent volatility is a reminder that cryptocurrency is a highly volatile asset. It has lost over seventy per cent of its value since its peak in 2021, which was around $68,000. Other cryptocurrencies like Ethereum have also seen a drop in recent weeks. The Ethereum-backed ether, which is tied to the bitcoin blockchain, has dropped seventy percent from its November 2021 high of $9,000. Even more concerning, China has banned all cryptocurrency transactions.

While central banks have a role to play in battling inflation, they also heighten the risk of recession. As interest rates rise, the prices of cryptocurrencies and stocks fall. In fact, the cryptocurrency market cap has dipped back to $900 billion after a recent spike.

However, the overall future of bitcoin remains uncertain. While some experts predict a positive price growth, bitcoin may be vulnerable to more volatility. In the meantime, more companies and investors have been embracing it as an investment. Major corporations such as Starbucks, PayPal, and AT&T have begun to accept bitcoin. The adoption of crypto assets by larger companies should help stabilize its value. Further, more trading platforms will help increase the market for individual traders. Coinbase, Kraken, and online investment firms like Robinhood are offering their services to cryptocurrency investors.

Bitcoin price hit multi-day highs after the August 23 Wall Street open. This was a result of a sharp drop in the dollar. As of writing, BTC/USD is eyeing $21,700, which would be a near-term resistance level, following the near-12% drop on Friday. The decline in the dollar was triggered by U.S. Purchasing Managers Index (PMI) prints for August, which showed a drop over the previous month and hit a low level not seen since May 2020.

While the price of Bitcoin is still far below its ATH, it is still expected to rise in the future. However, it is important to remember that the volatility in the crypto market makes it difficult to predict future prices. Therefore, it is vital for investors to do their own research and stay informed. Moreover, they must be aware of local regulations in their jurisdiction.

A recent news article in Russia reports that a bill in Russia will ban the use of crypto as a form of payment. While this may sound like a gimmick, it can be explained by the fear of the unknown. The bill passed the first reading in the State Duma, the lower house of parliament.

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