$10,000 bitcoin crash CONFIRMED? Here’s what you need to know…
The cryptocurrency market has struggled to move higher over the past few weeks. The FTX crash killed all hopes of a potential market recovery by 2023. Bitcoin managed to break above $18,000 yesterday, only to drop back below $17,000. Will Bitcoin hit $10,000 soon? Here’s what you need to know in this Bitcoin forecast article.
A terrible performance. Bitcoin actually started collapsing in October 2021, when its price dropped from $69,700 to an all-time high. 2022 started at around $48,000 for Bitcoin. Since then, prices have been heading south with no let-up. If we look at Figure 1 below, we can see how prices are in an ongoing downtrend.
Since the beginning of 2022, Bitcoin has lost about 65%. However, traditional markets are not doing well either. For example, Facebook has fallen by 65% year-on-year, and Credit Suisse by 67%.
Why Bitcoin Crashed in 2022?
This is the million dollar question. It is very difficult to know which factors directly affect the decline in Bitcoin prices. However, we can identify some key factors that contribute to Bitcoin price movement:
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- Market demand: The price of Bitcoin is affected by the overall demand in the market. If more people are interested in buying Bitcoin, the price can go up, if less people are interested in buying it, the price can go down. 2022 caused many Bitcoin holders to liquidate, reducing demand for Bitcoin, thus driving down prices.
- Regulatory developments: Changes in the regulatory environment for Bitcoin and other cryptocurrencies can also affect their prices. For example, if a government announces plans to crack down on the use of the cryptocurrency, the price of Bitcoin may drop. In 2022, many countries banned cryptocurrencies, causing prices to drop.
- Economic conditions: Bitcoin price can also be affected by broader economic conditions such as interest rates and inflation. If the value of traditional assets such as stocks and bonds falls, some investors may turn to Bitcoin as an alternative investment. 2022 has been a bad year for all types of investors, including cryptocurrencies.
- Market Manipulation: The price of Bitcoin and other cryptocurrencies can also be affected by market manipulation, where individuals or groups attempt to artificially influence the price by buying or selling large amounts of cryptocurrency. This leads directly to pumps and discharges, where the latter are more rigid.
- Security breaches: If a major exchange suffers a security breach, it could cause the price of Bitcoin and other cryptocurrencies to drop. In 2022, we saw many cryptocurrencies being hacked, which directly reduced investor confidence in cryptocurrencies.
- Adoption by merchants and consumers : As more merchants and consumers accept Bitcoin and other cryptocurrencies as a payment method, the demand for these assets may increase, which may cause their prices to rise. However, 2022 did not see an increase in Bitcoin adoption. On the contrary, people have run away from cryptocurrencies as they have lost value.
It should be noted that these are only some of the factors that can affect the price of Bitcoin and other cryptocurrencies, and the relative importance of each factor may change over time.
Bitcoin Prediction: Has Bitcoin Crashed to $10,000?
Bitcoin prices show no signs of turning upwards at the moment. Despite many attempts, the downward trend continues. If the bear market continues next year, we expect Bitcoin prices to reach the $10,000 to $12,000 price range in the second quarter of 2023.
This does not take into account any additional factors that affect cryptocurrency prices. On the other hand, a breakout of Bitcoin’s red downtrend should signal a reversal. But we are far from that now. December continues to decline even in the first quarters of 2023.
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