After a somewhat stable start to the year, the price of bitcoin plunged by nearly 10 percent in the last 24 hours in what may be a return to the bear market of 2018.
Bitcoin, which had been trading in a band of $3,800 to the low $4,000s over the last week, dropped from $4,018.41 as of 1 a.m. EST to $3,614.14 by 10:15 p.m., slightly up from a daily low of $3,596.63.
Other major cryptocurrencies declined further, with Ethereum, Litecoin and Bitcoin Cash all dropping more 16 percent at one point, according to Forbes.
Nobody knows why for sure. Mati Greenspan, senior market analyst at eToro Inc., told CNBC that there doesn’t seem to be either a technical or a fundamental reason for the drop.
“The one interesting thing about this movement is that it seems to be an exact reversal of the surge that happened on Sunday afternoon,” Greenspan said. “At this point, the gains made since the start of the year have now been reversed and we’re back to a neutral 2019.”
Timothy Tam, co-founder and chief executive officer of CoinFi, told Bloomberg that he noticed a large transfer of about 40,000 Ether into an exchange an hour before the drop, suggesting that a big sell on Ethereum may have driven cryptocurrencies down across the board.
“Usually transfer of Ethereum onto an exchange indicates an intent to sell and if there is a sell-off on one exchange it compounds like dominoes to another because arbitragers will sell immediately on the other exchanges as well,” Tam said.
Some predict bitcoin may fall further. Vinny Lingham, chief executive of CivicKey, told Cheddar that “I think there is a good chance we’re going to retest $3,000 as a low” and that “there is a good chance we’ll probably break through that if it heads that low.”
Lingham added that a bitcoin price range of between $3,000 and $5,000 seemed realistic before either a “breakout or a breakdown.”
Since you’re here …
The journalism, reporting and commentary on SiliconANGLE — along with live, unscripted video from our Silicon Valley studio and globe-trotting video teams at theCUBE — take a lot of hard work, time and money. Keeping the quality high requires the support of sponsors who are aligned with our vision of ad-free journalism content.
If you like the reporting, video interviews and other ad-free content here, please take a moment to check out a sample of the video content supported by our sponsors, tweet your support, and keep coming back to SiliconANGLE.