Bitcoin Endures a Very Scary Weekend2 min readReading Time: 2 minutes
Bitcoin suffered through a scary weekend that saw the world’s number one digital currency fall all the way down to the mid-$17,000 range. The news was troublesome for many traders not just because they saw bitcoin dip even further than anticipated, but because the asset ultimately wiped away as many as five years’ worth of gains.
Bitcoin Is Back Above $20K
It’s true that bitcoin was last trading for comparable amounts during 2020. This is technically only two years ago, though it’s important to point out that $17,000 is less than the all-time high of nearly $20,000 that was achieved in late 2017. Bitcoin rose to a whopping $68,000 per unit in November of 2021, so to see it take such a heavy pummeling arguably brought the currency back several steps.
Now, at the time of writing, the currency is once again slightly over the $20,000 range, meaning there is a small bit of recovery in the books, but this is still nowhere near where the asset was just seven months ago, and investors all over the globe are worrying about what could possibly be next for the currency. Right now, bitcoin is only barely above the $20,000 mark. This means the asset could still end up dipping even further or engaging in another widespread freefall.
With the economy in shambles (the stock market is also down significantly, and inflation is soaring through the roof), it’s no question why bitcoin has been suffering so much. The Fed continues to hike rates as a means of fighting gouging prices and making up for the last two years of stimulus measures that arguably brought a start to the inflation.
The big questions now are not only, “When will it recover?” but also, “Can it recover?” Could we potentially begin to see bitcoin making headway again towards the later months of the year, or has 2022 been marred by bear activity on a more permanent basis?
It’s nearly impossible to predict which route bitcoin will take given the asset’s behavior is largely unpredictable. There are traces of 2018 in the current spectrum (this was a year in which bitcoin exhibited no recovery), but there are also traces of 2020.
Could There Be Recovery in the Coming Months?
During that year, bitcoin fell quite a bit during the first few months of the year, but it ultimately made a monster-sized comeback. It even finished that year attaining a new high, and while it wasn’t as heavy as it would be in 2021, it certainly made 2017 look small by comparison.
So, to assume that things are dead and done for is not entirely accurate. One can predict that bitcoin has just as much chance of rising back up the financial ladder as it does of crashing into the deep, dark abyss it seems to be trying to pull itself from.