The ether also weakened sharply.
Feb 23, 2021 at 9:35 am (updated Feb 23, 2021 at 11:48 am) TASR
SINGAPORE. The price of bitcoin fell sharply on Tuesday, falling well below $ 50,000 (€ 41,210). The sell-off in the cryptomen markets has triggered investors’ fears of over-valuation and the taking of profits of some leveraged players.
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The most famous and largest cryptocurrency lost more than 17 percent on Tuesday, its sharpest daily decline in a month, and its price dropped to $ 45,000.
Bitcoin later erased some of the losses and at 10:29 CET was at a loss of 11.3 percent.
Compared to a record high of $ 58,354 reached on Sunday, bitcoin has weakened by almost a fifth. However, the profit since the beginning of the year is still around 60 percent.
“This kind of rapid growth that we have seen is not sustainable and directly calls for such a decline,” said OANDA analyst Craig Erlam.
According to the head of the Q9 Capital digital platform, James Quinn, the bitcoin market has grown almost continuously since the beginning of the month and, in fact, since the beginning of the year, so that some correction and sale is normal and healthy. However, he pointed out that the liquidation of leverage positions on the Binance cryptobourse was large, which may signal that retail investors are selling bitcoin.
The second largest cryptocurrency, ethereum, also fell sharply on Tuesday, with the price also falling by more than 17 percent. In the morning, the ether sold for $ 1,461. Compared to its maximum from last week, it has already lost almost 30 percent.
US Treasury Secretary Janet Yellen, who called for stricter regulation of cryptocurrencies, said on Monday that bitcoin was extremely inefficient in carrying out transactions and that it was a highly speculative asset.
According to critics, bitcoin, like other krymenena, is highly volatile, which is one of the reasons why it is not widely used as a means of payment.
Cryptocurrencies have undergone spectacular reinforcement “and such a sudden drastic change is not really unexpected,” commented CMC Markets chief strategist Michael McCarthy.
He added that this market lacks the fundamentals, so the high levels of support and resistance are the psychological levels – $ 50,000, $ 40,000, $ 30,000 and so on. Therefore, after the drop of bitcoin below 50 thousand USD, the sale may accelerate according to him.
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