Between yesterday and today, the price of Bitcoin fell by 8.5%, dropping from around $66,000 to around $60,000.
Bitcoin, price down due to Infrastructure Bill
This is a larger drop than the others that have occurred recently, and the $60,000 level has not been seen since November 6.
According to a report today by Bloomberg, some analysts would attribute this drop in the entire crypto market to the new tax reporting requirements for digital currencies that are part of the US infrastructure bill that President Joe Biden signed on Monday.
Cryptocurrencies at a loss
In fact, it is not just the price of Bitcoin that has fallen in the last 24 hours, as all of the top 50 cryptocurrencies have lost value between yesterday and today.
Ether is losing more than 9%, Polkadot and Terra more than 10%, Chainlink more than 12% and Crypto.com more than 15%.
US and China stop BTC’s run
According to the CEO of the social trading platform Alpha Impact, Hayden Hughes, several cryptocurrency sell-offs were initiated by traders following the signing of the infrastructure bill, as they were concerned about the new regulation and related taxation.
Hughes also cites ongoing concerns in the Chinese markets, with China continuing its regulatory crackdown. The country is reportedly considering imposing significant increases in electricity prices for mining companies, but in reality, Bitcoin mining in the country has all but ceased.
On the other hand, it should be noted that yesterday, as BTC fell, the dollar appreciated so much that the Dollar Index hit a new all-time high for 2021 at over 95.5 points. Just a little over two weeks ago it was at 93.3, and such rapid rises for this index are definitely not the norm.
Bull run on pause
Bloomberg also reports that in recent days, technical indicators have suggested that the current cryptocurrency bull run is ready for a break.
According to Asia-Pacific head of crypto exchange Luno, Vijay Ayyar, it would be unusual for such a bull run to continue without a correction, and he says the current one is “a healthy pullback” after a prolonged rally.
Beginning on November 7, Bitcoin’s price returned above $61,000, and then recorded its new all-time high on November 10 near $69,000. This quarter the $60,000 mark was broken for the first time on 15 October, and since then the price of BTC has always hovered above this threshold, with rare and brief exceptions.
After a month at these levels, a correction was indeed possible, so much so that the current one may not jeopardize a revival of the rally once it is over.
The post Bitcoin at $60,000: the causes of the price drop appeared first on The Cryptonomist.
