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Market Musings

Bitcoin Bounces Back 20% — Hours After ‘Healthy’ Correction

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Published on:
January 12, 2021

‘The fact Bitcoin can “crash” to $30,000 is so bullish it’s hard to overstate,’ Eric Wall told Decrypt.

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Rumors of Bitcoin’s death appear to have been greatly exaggerated, it seems.

 

After plunging to depths of $30,549 on Monday, the world’s biggest cryptocurrency mounted an impressive comeback. At one point, BTC has rallied by 19.74% in a matter of hours — taking it all the way to $36,568.

 

Some crypto executives, such as Nic Carter of Castle Island Ventures, didn’t even blink at the turbulent start to the week. When BTC hit its low point on Monday, he wrote:

“After watching Bitcoin plunge 50% to $3,000 in 24 hours in an apparently ‘mature’ market last year nothing fazes me anymore.”

Others — such as Tyler Winklevoss —  saw the correction as an opportunity for people to buy the dip and gain exposure to BTC. He wrote:

“For everyone who missed 35k #Bitcoin last time, now’s your chance.”

Glassnode data shows the number of active Bitcoin addresses reached an all-time high on Monday, beating a previous record set just three days earlier.

 

BTC trading volumes have also surpassed the dizzying highs seen during the 2017 bull run. Arcane Research’s Bendik Norheim Schei told CoinDesk:

“Some of this volume is definitely from new and unexperienced investors entering the market for the first time and panicking when the price starts falling. These corrections are necessary and healthy, even in a bull market.”

Meanwhile, Arcane Assets CIO Eric Wall told Decrypt “the fact that Bitcoin can ‘crash’ to $30,000 is so bullish it’s hard to overstate.”

 

What remains to be seen is what’s next for Bitcoin. Will there be a double-dip plunge, or will BTC begin the painful journey back up to the $40,000s — and attempt once again to smash the records it broke so easily in the first week of January?

 

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