Bitcoin fell for a second day, extending a downdraft triggered by Wednesday’s revelation that a member of the cryptocurrency community from the blockchain’s earliest days in 2009 had moved a long-dormant cache of coins.
As of 20:30 UTC (4:30 p.m. ET), bitcoin (BTC) was trading at $9,044, a loss of 5.6% over 24 hours.
Bitcoin remains well below its 10-day and 50-day technical indicator moving averages — a signal of bearish sentiment.
At 14:00 UTC (10 a.m. ET) the world’s oldest cryptocurrency began experiencing high selling volume on exchanges including Coinbase, dropping bitcoin below $9,000 for the first time since May 13.
Bitcoin trading on Coinbase since May 19Source: TradingView
While the market appears to have turned bearish, Rupert Douglas, head of institutional sales at asset management firm Koine, said he planned to “‘buy the dip” — a popular phrase for accumulating an asset when prices drop in the belief that they’ll soon start going up again.
“In a way I was hoping for this,” Douglas said in an email. “I’m a buyer at $9,000, as this is shaking out the weak longs before taking it higher.”
Volatility in the notoriously fickle bitcoin market has declined since collapsing in March, when the devastating economic toll from the coronavirus started to become clear.
“I wouldn’t call this a dump,” Darius Sit, managing partner at crypto quantitative fund QCP Capital, told CoinDesk via a Telegram message. “It’s nowhere near statistically significant.”
Bitcoin volatility since 1/1/20Source: CoinDesk Reserch
The price drop could take a toll on the profitability of bitcoin miners, already hurting from a revenue cut following last week’s rewards halving. The miners have had to rely more on transaction fees to maintain revenue.
Bitcoin miner revenue from fees the past three years – dotted line is halving eventSource: Glassnode
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