Bitcoin has fallen sharply after U.S. president Donald Trump revealed former Federal Reserve governor Kevin Warsh as his Fed chair nominee, ending months of wild speculation.
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The bitcoin price, which has plummeted to nearly $80,000 per bitcoin from its peak of $126,000 in October, is battling to save its reputation as digital gold.
Now, as traders await what could be an even bigger bitcoin price shock, the market is braced for a 40% bitcoin price crash that would see $1 trillion wiped from the combined crypto market.
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U.S. president Donald Trump has promised to make the country into the world’s crypto capital, though the bitcoin price has crashed back from its October peak of $126,000 per bitcoin.
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“Key indicators we’re watching include bitcoin’s support levels around $50,000,” Gracy Chen, the chief executive of crypto exchange Bitget, said in emailed comments, implying the bitcoin price could drop by another 40% to take the bitcoin market capitalization to $1 trillion.
Chen said he’s watching falling “trading volumes for signs of capitulation or rebound,” and signs that the market is “oversold,” which could “signal stabilization and renewed buying interest.”
For now, traders are focused on the $80,000 level, with fears of a bitcoin price crash likely to escalate if bitcoin drops under it.
“A break below the key $80,000 psychological level could accelerate selling pressure once again,” Yuya Hasegawa, bitcoin and crypto market analyst at the Tokyo-based Bitbank, said in emailed comments.
“That said, should bitcoin decline another leg lower, oversold conditions and perceived value levels may increasingly attract dip-buying interest.”
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The bitcoin price has dropped sharply, sparking fears a full-blown bitcoin price crash could be looming.
Forbes Digital Assets
Meanwhile, the wider crypto market has fallen sharply along with the bitcoin price, pushing it under the closely watched $3 trillion level.
“Our worst-case scenario assumes a decline to the $1.8 trillion to $2 trillion range, with an extension to 161.8% of the initial downward momentum in October-November,” Alex Kuptsikevich, FxPro chief market analyst, said in emailed comments.
