Bitcoin dropped to a one month low Friday, and was heading for its worst week since June. This happened because traders had taken profits from a long rally but were scared by the possibility that Mt Gox’s creditors might liquidate their funds.
Bitcoin, the largest cryptocurrency in market value, was at its lowest point since mid-October, and it was trading at $55,980, mid-session Asia. This is 20% lower than last week’s record high.
Matthew Dibb (chief operating officer of Stack Funds, a crypto asset manager based in Singapore) said that selling pressure has been constant and that it will continue until the token is supported at $53,000.
Bitcoin has dropped 14% over the past week and is now at its 50-day moving mean. It has risen more than 90% in the past year.
Dibb stated that there was profit taking, and concern about further selling after a Tokyo court approved plans to repay creditors Mt Gox. This is a crypto exchange that collapsed in 2014 after it lost half a million dollars in bitcoin.
“Those who are affected will be given a large amount of bitcoin. This is likely to happen in Q1 or Q2 2022. He said that this has caused some fear in the market over the longer term, based on the expectation of those creditors being sellers.
Ether, the second-largest cryptocurrency in market value, was steady at $4,014 for Friday, but it is expected to lose 14% per week.
Both bitcoin and ether have also suffered from the cautious mood on global markets in recent days, amid concerns about economic growth and interest rates.
Edward Moya, an OANDA analyst, stated that Bitcoin’s long-term outlook is bullish.
“But, the waters will be rough over the next few months as institutional investors watch to see if Fed will be forced sooner to raise rates and trigger a broad-based sale of risky assets like bitcoin.