The crypto market shed more than $8 billion yesterday, raising questions about the long-term volatility of several of the market’s biggest names.
Bitcoin (BTC) set new lows for the year, as it fell below $6,000, while several other major cryptocurrencies tanked more than 10%.
Bitcoin Cash (BCH) is also going south very quickly. For the first time in 10 days, BCH has fallen below the $500 mark after securing a monthly high of $630 last week. BCH has dropped by almost 25% ahead of planned hard fork to upgrade security protocols.
What happens to Bitcoin Cash
Usually, prior to a hard fork, investors buy a significant portion of the crypto in question. When the chain splits, they get both cryptocurrencies from the fork – as it happened with Bitcoin and Bitcoin Cash in summer 2017.
Indeed, before the planned November 15 hard fork, the Bitcoin Cash price has risen by more than 50% and was expected to grow further.
However, instead of a steady increase in anticipation of the hard fork, Bitcoin Cash suffered from a huge drop and experienced a heavy sell-off.
Crypto civil war: why is it happening?
There are some signs that investors have lost their confidence in Bitcoin Cash, owing to the uncertainty caused by the recent conflict between the Bitcoin SV and Bitcoin Cash camp.
Traders were concerned that Bitcoin and Bitcoin Cash markets could run into a slowdown or chaos after the planned software upgrade.
Meanwhile, the BCH short downtrend intensified and the cryptocurrency lost almost 30% of its value within the past 10 days. Will there be a corrective rally?
Are cryptocurrencies dead?
Not long ago the crypto markets showed almost no volatility and were thinly traded. Last year’s hype ended.
Today, they are moving so fast that we can only guess where it all goes.
If we were to look at historical prices, it becomes clear that Bitcoin (BTC) price movements seem to go in cycles.
BTC price expanded from $4.2 to $13.51
BTC jumped from $13.51 to $758 in a 5507% gain
BTC/USD prices fell sharply to $320
2015 – 2017
BTC prices shot from $320 to $13,860
Will bulls reign?
The optimists may say that the current meltdown is just a part of a Bitcoin cyclical plan and BTC will spring back to $8,500 next year.
However, in the moment, we should be alert to the possibility of new, lower Bitcoin levels to watch: $5,000 and then $3,000.
Stop the madness
It’s a common belief that no one can actually stop the blockchain steam train. When the markets are up and the prices are high, people regret they didn’t buy when the prices were lower.
However, it’s a paradox: when the prices hit those lows, they are afraid to buy.
Maybe the current crypto market situation is a good one for those who believe in the potential of particular coins, finding the chance to trade them at lower prices.