The crypto market’s woes deepened further on Wednesday, with Bitcoin’s price falling below $40,000 for the first time since February.
Lex Moskovski, the chief investment officer at Moskovski Capital, pointed to charts suggesting that, on average, most investors are now selling at a loss.
In an earlier tweet late on Tuesday evening, he said that 22,917 BTC was deposited to exchanges in a single hourly period — a sign people are preparing to offload. He wrote:
“This hourly inflow is rivaled only by the March 2020 crash. People are scared.”
Only yesterday, CoinMarketCap Alexandria reported that Bloomberg was anticipating a pullback to the 200-day moving average, taking BTC down to $40,000. That has now happened — probably a lot faster than they were expecting.
What remains to be seen is whether predictions from CNBC’s Carter Worth end up being correct. He previously stated his belief that BTC could tumble 55% from recent all-time highs of $65,000, taking the cryptocurrency down to $29,000.
Bitcoin’s lowest point over the past 24 hours comes in at $38,717.16. At the time of writing at least, it has managed to retake $40,000… but only just. Overall, we’ve seen losses of 10.4% since 10am London time on Tuesday, extending to a 30% downturn over the past week.
But here’s another way of looking at it: BTC has now lost all of the gains that were accrued since Tesla announced that it had invested $1.5 billion into the world’s biggest cryptocurrency. Investors have been shaken ever since Elon Musk announced that the electric vehicle manufacturer would suspend accepting BTC as payment over climate concerns.
Other factors in the dramatic decline include the People’s Bank of China warning that the likes of Bitcoin cannot be used for payments because they are not “real currencies.” This comes as Beijing continues to add the finishing touches to the digital yuan.