Bitcoin Prices Plunge by over 40% this week amid market turmoil

What's the value of Bitcoin when the markets are bad?

Bitcoin Prices Plunge by over 40% this week amid market turmoil

Bitcoin Prices Plunge by over 40% this week amid market turmoil

Bitcoin prices have plummeted this week, hitting a low of $4144 when the cost of bitcoin was over $9,000 a week ago. While prices have recovered somewhat, Today's bitcoin price remains under the $6,000 market; representing a price decrease of around 40% since this time last week. 

What caused this price decrease? The simple answer is that the markets are in chaos, thanks to the impact of the global Coronavirus pandemic. Stocks and index funds are losing value, and that has also caused the value of cryptocurrencies to fall off a cliff. 

There are fears that the Coronavirus Pandemic will start a global recession, and if that happens, a lot of people will stop valuing cryptocurrencies. With Cryptocurrencies lacking any financial backing, it is easy to see why such large drops in value can occur.

At best Cryptocurrencies are an unsafe investment, especially within today's turbulent markets. If the financial markets continue to be strained by Coronavirus, we can expect the crypto market to be equally impacted. 

Altcoins like Etherium, XRP and Bitcoin Cash have also been hit hard over the past week, with all of them seeing drops in value of around 40%. This situation is likely to get worse if the global financial markets continue their current trends. 

Bitcoin Prices Plunge by over 40% this week amid market turmoil  
(Bitcoin Pricing over the past week, image from Coindesk)

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Most Recent Comments

13-03-2020, 10:45:32

Essentially when the stock markets start to tumble like yesterday(Especially with the S&P500), traders need to sell off any liquid assets they can in order to meet margin calls, so all commodities and risk-on assets like Bitcoin will have constant selling pressure during the period, usually this wanes over the following days and things begin to return to previous buying pressures (And eventually after prices) once everything has stabilised.

Of course, since the real route cause here is the coronavirus, no one can say really if anyone is out of the woods yet, and if there was a 2nd S&P500 sell off with BTC market cap so low now it could plunge even further.

BUT, a global recession in and of itself wouldn't be the killer risk to crypto, it's more the instantaneous side effects of the stock market crashes that do it.Quote

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