Bitcoin drops below $30,000 mark first time since January 2021

The price of Bitcoin slipped further, dropping below $30,000 briefly for the first time since January 2021, erasing its gains for the year before recovering to trade at $32,481.93. At one point, the world’s most popular digital coin shed more than 10% to trade as low as $29,154.73. As such, it lost more than half its value since hitting a record high in April.

Mike Novogratz, Galaxy Digital CEO, told CNBC Squawk Box that the popular cryptocurrency could still rebound after the early decline and if it didn’t recover, there was significant downside to the next support level. “Thirty-thousand, we’ll see if it holds on the day. We might plunge below it for a while and close above it. If it’s really breached, $25,000 is the next big level of support,” he said.

Edward Moya, senior market analyst at foreign-exchange trading service OANDA, said long-term bitcoin bulls are getting nervous as a break of $30,000 could see a tremendous amount of momentum selling. “Many traders have waited for one more push lower, which could see crypto traders wait for a plunge toward the $20,000-$25,000 area.

Nikolaos Panigirtzoglou, JP Morgan strategist, in a report earlier this month said there is little doubt that the boom and bust dynamics of the past weeks represent a setback to the institutional adoption of crypto markets and in particular of bitcoin and ethereum. But whatever the fall, some see this as a silver lining and are using the decline as a buying opportunity. Micro Strategy, enterprise software company, said it bought and additional $489 million worth of bitcoin, bringing its total holdings to 105,085 bitcoins.

Also Read: Lightspeed leads pre-seed funding round in insurtech start-up BimaPe

Other cryptocurrencies also recorded losses, with ethereum declining more than 5%. Smaller coins like dogecoin fell more than 25%, erasing all its gains since April. The crypto market has been on the slide ever since Tesla CEO Elon Musk, who had been creating frenzies by mentioning cryptocurrencies in his tweets, in May said that Tesla will stop using bitcoin as a form of payment over environmental and energy concerns.

Analysts attribute bitcoin’s slump in June to the cryptocurreny’s use in the Colonial Pipeline ransomware attack. Then there is also the crackdown in China with the Chinese central bank ordering some banks and payment firms, including China Construction Bank and Alipay, to crack down further on cryptocurrency trading.