The volatile nature of cryptocurrency showed once again on Sunday when Bitcoin dropped from its $40,000 price range to $32,000. Many experts foresaw institutional investors going bearish on the asset since its outstanding performance. While some expected massive price growth, the digital asset gave them a shocker as it dropped up to 7%of its previous value.
The crypto community believes the current bull run is not as effective as it was in the past few days, and that caused the drop in value. On Sunday evening, the asset already dropped to $39,000 before it further dropped to $37,000. After that unexpected drop, it increased to 38,000, which is now the current value.
The institutional demand for Bitcoin
Deep pocket investors are demanding more cryptocurrency daily, helping the price stabilize to a certain degree. During a zoom call by Skybridge, an investment company with crypto holdings, numerous investors were interested in Bitcoin.
They joined the call to get more information concerning the digital asset. Unfortunately, the call was short-lived because of its traffic, with more than 5,000 investors trying to participate in the conversation. The zoom call was to launch the company’s new Bitcoin Fund, which will help their clients gain exposure to crypto without directly investing in it.
Value is an essential aspect of assets, and that is why Bitcoin holders strive to increase asset value, especially those who are bullish and plan on keeping the investment for longer. The numerous Bull Run Bitcoin had essentially work to push the value beyond the charts.
Bitcoin’s worth in the past month rose to 100%, which is unusual for the traditional asset, and the rallies, along with other factors, are the ultimate factors pushing crypto prices forward. Due to the digital asset’s current price, many investors are afraid of a price correction that could cause significant losses, the reason for the sell-off, and the search for a cheaper alternative.
Altcoins taking the lead
Historically, Investors ignored altcoins mainly because of the uncertainty they hold and lack of adequate information on the assets. Now, altcoins like Ethereum perform impressively, despite Bitcoin taking most of the market. Investors see ETH as a cheaper alternative that could one day be better than the crypto giant, Bitcoin.
The coins gained considerably in the past weeks, signaling more monies coming into their market. Experts are afraid that Bitcoin would dwarf other digital assets, but altcoins have growing demand, with the largest altcoin having a market capitalization of almost $70 billion. Litecoin, Bitcoin Cash, and Bitcoin SV also saw new increases around the new year period.
Analysts opine that Bitcoin would continue to drop in value, primarily caused by investors selling their assets for profit. The bearish market is a source of concern to long-term investors who doubt keeping their assets.
Though the price stands at $38,000, further price correction could spell doom for the flourishing investment. Most people did not expect the asset to amass so much value in such a short time; some are already taking steps to exit the investment with the profit gained.