Bitcoin’s price soar from Wednesday, was sustained through early trades on Thursday after the world’s largest cryptocurrency experienced a sharp sell-off earlier in the week, climbing above $50,000 backed by news of Square announcing it had purchased $170 million worth of the cryptocurrency.
BTC headed south vigorously and lost over $11,000 of value to an intraday low of $47,500 after a comment made by Elon Musk and US Treasury Secretary Janet Yellen, with Elon mentioning that the price of the crypto “seemed High” and Yellen mentioning that BTC was a “highly speculative asset” that is extremely inefficient for transactions. Shortly after this massive drop, the bulls took charge and drove the cryptocurrency back to $55,000.
However, bitcoin couldn’t sustain its recovery and dipped below $50,000 once more. At the time of this writing, the primary crypto has regained some traction and currently sits slightly below above the coveted $50,000 mark according to data from Bitfinex exchange.
Ultimately, BTC’s market capitalization has lost more than $100 billion in a day and has dropped well beneath the $1 trillion level. BTC is still up more than 70% in year-to-date returns and over 400% in the last 12 months
BItcoin Wave Hits Altcoins
As it typically happens during a sharp correction, most alternative coins have it even worse than their leader. Ethereum has decreased by over 15% on a 24-hour scale to $1,600. Just for reference, the second-largest crypto painted a new ATH during the weekend at above $2,040. As such, ETH is down by more than $400 in a few days.
Ethereum has been going up for a long time now, slowly but surely heading towards the $2k mark. The coin did not have many instances where it suddenly skyrocket like what Bitcoin tends to do. Instead, it was a long but steady growth, and it finally allowed ETH to hit the $2,000 milestone late on February 19th. The coin reached this milestone just as the weekend started, and it even kept going for the most part on Saturday.
Binance Coin, which also surged to new record levels around $350 lately, has plummeted to $235. Polkadot (-8%), Cardano (-5%), Ripple (-12%), Litecoin (-15%), Chainlink (-17%) are also well in the red from the top ten.
Further losses are evident from Dodo (-25%), Elrond (-24%), Siacoin (-23%), IOST (-23%), 1inch (-23%), Ontology (-22%), Aave (-20%), Curve Dao Token (-20%), Waves (-20%), BitTorrent (-20%) and more.
Consequently, the cumulative market capitalization of all cryptocurrency assets has plummeted by more than $260 billion to $1.5 trillion.
The slump in BTC was also fueled by Charlie Munger, the long-time business partner of Warren Buffett, who said investors should not buy gold or bitcoin, noting the latter was too volatile to become a “medium of exchange for the world.”
MicroStrategy Buys Bitcoin
Microstrategy, the largest independent publicly-traded business intelligence company, said it had managed to buy $1 billion worth of BTC. The purchase made by the company was made with zero-interest debt making it one of the single largest BTC investments ever by a publicly-traded company. Other than this, the only large investment that we know about is Tesla’s $1.5 billion.
The news came in even as larger global corporations seemed to rally their support for ease of transactions on the cryptocurrencies. Payment companies like Visa and Mastercard have already confirmed their plan to add Bitcoin as a payment method on their platforms by the end of the year.