Bitcoin has plummeted in price. Analysts' forecasts are full of negative

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At the beginning of the trading session on Tuesday, the quotes of the first cryptocurrency fell sharply below the level of $30,000 to $29,400. Thus, over the past 24 hours, bitcoin has lost about 5.5%. At the same time, during the past day, the lowest cost of BTC reached $29,311, and the highest was $31,693. At the time of writing, the main virtual asset is trading at $29,549.


A day earlier, bitcoin rose by 4.9% to $31,760, but in just a few morning hours on Tuesday, it rolled back from its previous highs and began to permanently become cheaper.

By the way, the current collapse of bitcoin is far from the only one in the last month. On May 12, the coin rate fell to $26,700, the lowest since the end of 2020. But the very next day, bitcoin instantly soared by 13%, recouping previous losses, and slipped past the $30,000 mark.

Since the beginning of June, bitcoin has shown a price decline of 7.1%. Over the past two months, the cost of BTC has fallen 1.6 times to $29,000 from $45,800. At the same time, bitcoin has lost 30% since the beginning of spring. Since last November, when the coin updated its historical record, soaring above $69,000, the cryptocurrency has already lost about 60% in price. At the same time, many other virtual assets have plummeted from their record levels.

Altcoin market

On Tuesday, the main competitor of bitcoin, the altcoin Ethereum, also started the trading session with a fall. So, at the time of writing, the value of the coin reaches $1,755.

In the last days of May, altcoin slipped through the $2,000 level, but with the onset of summer, it lost its desire for optimism and rolled back to the previous level.

As for cryptocurrencies from the top 10 by capitalization, the lowest result for the past 24 hours was recorded by Binance Coin (-7.37%). At the same time, all other coins from the top ten reported a confident decline.

According to the results of the past week, the main outsider among the top ten cryptocurrencies was the Solana coin (-16.72%), and the key favorite was Cardano (+1.44%).

According to CoinGecko, the world's largest aggregator of data on virtual assets, over the past 24 hours, in the top 100 most capitalized digital assets, the list of leaders was topped by the eCash coin (+9.7%), and Chiliz (-10.3) took the first place in the drop list. %).

According to the results of the past week, the main outsider among the hundred leading cryptocurrencies was the Terra Luna coin (-41.1%), and Waves (+8.4%) was the key favorite.

Pessimistic forecasts of experts

High volatility and unpredictable behavior of the cryptocurrency market force experts to make the most unexpected statements about its future. Ripple CEO Brad Garlinghouse said that in the near future the digital asset market will be reduced to "dozens" of cryptocurrencies.

According to Garlinghouse, the recent high-profile collapse of the algorithmic stablecoin Terra USD (UST) and the digital token Luna, when the cryptocurrency market lost billions of dollars over several weeks, was clear evidence of the serious vulnerability of virtual currencies.

Earlier, the investment director of the international consulting company Guggenheim Partners, Scott Minerd, stated that most crypto coins are "junk" and will disappear forever in the future, while only bitcoin and Ethereum will be able to survive the coming crypto winter.

The investment director of Soros Fund Management, Dawn Fitzpatrick, also announced the great prospects of the Ethereum altcoin in her recent interview with the American news agency Bloomberg. After the launch of the Ethereum 2.0 update, Fitzpatrick believes cryptocurrency will become a more sought-after asset for investors than BTC.

The businesswoman is certain that today one of the most important criteria for the appeal of a digital asset is its impact on the environment. The less harm it does to the environment, the more popular it will be with users. Thus, according to Fitzpatrick, Ethereum has every chance to overtake bitcoin, because now the coin is on the way to transition from the energy-intensive Proof-of-Work mining model to the more environmentally friendly Proof-of-Stake.

Earlier, Canadian-Russian programmer and Ethereum co-founder Vitalik Buterin said that the transition to PoS could take place as early as August this year. In this regard, Dawn Fitzpatrick believes that the blockchain has limitless possibilities, because this technology allows you to store data as securely as possible and track information transparently.

At the end of May, during the World Economic Forum in Davos, Web3 Foundation CEO Bertrand Perez drew analogies between digital assets and dot-coms (companies that build their business models entirely on working within the Internet). At the beginning of the Internet age, many of the existing dot-com companies were fraudulent and did not bring any benefit, but later the market got rid of them, and today only useful and legitimate companies remain on it. "Currently, the bearish trend prevails in the cryptocurrency market. And I think that's good, because it will clean out those who were there for bad reasons," Perez said.

At the end of his speech, Perez called the collapse of Terra a logical outcome of the overflow of the market with blockchains and tokens. The oversaturated market, says the CEO of the Web3 Foundation, confuses investors and carries high risks for them.

At the same time, most cryptanalysts still name the decisive steps of the US Federal Reserve to tighten monetary policy as one of the main factors of pressure on the market. Thus, in recent months, the digital asset market and shares of the technology sector of the US stock market have reacted sharply to the active monetary stimulus of the central bank due to the coronavirus crisis.

By the way, analysts increasingly began to emphasize the high level of correlation between the securities market and virtual assets amid tense expectations of the Fed's succeeding steps.

As proof of the high correlation between the value of cryptocurrencies and stocks, we can cite the April trading results of the flagships of both markets. This month, the high-tech NASDAQ Composite has lost more than 12%, its biggest drop since 2008.

At the same time, in April, the cost of bitcoin sank by 16.2%, the lowest indicator of this month since 2011.

Earlier, experts from the investment company Arcane Research have already stated that the correlation of BTC and technology securities has reached a high since July 2020.

Such close parallels between digital gold and the NASDAQ index make investors increasingly doubt the ability of cryptocurrency to become a hedge against inflation and worry that BTC may soon become a traditionally risky asset instead of an alternative one.

It is obvious that today the Fed has taken a course on tightening financial conditions, which, in turn, can cause an even greater drop in the value of technology stocks, and with it an active decline in the crypto market.

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