A number of top voices in the crypto ecosystem also believe that the current price crash is ideal for a new rebound to new highs.
The cryptocurrency industry is seeing a wide crash in the price of Bitcoin (BTC) and major cryptocurrencies are on the decline for what many analysts see as a “Necessary Retest” according to a CoinTelegraph report. The selloff in BTC began more than 24 hours ago and the progressive dump-off has pushed the coin’s valuation from its 7-day and All-Time High (ATH) of $68,742.31 to its current price of $63,563.62, down 2.76% in the past 24 hours.
The slump in BTC has also dragged along the majority of altcoins. Ethereum (ETH) is down 1.83% to $4,617.38, Binance Coin (BNB) slumped 2.01% to $615.39, while Solana (SOL) took the harder hit, dropping 5.17% to $227.01 according to data from CoinMarketCap. The combined market capitalization of the global digital currency ecosystem is down 2.57% to $2.78 trillion.
The overblown clamor on the impact of China Evergrande’s financial crises comes off as one of the prominent factors impacting the price of several digital assets today. According to Jean-Marc Bonnefous, head of asset management at Tellurian ExoAlpha, “there has been much talk about the impact of the Evergrande story on the recent sell-off in the market.”
The analyst said the “Evergrande news is to equities what Elon Musk tweets are to cryptos” in that it is “somewhat manipulated news to move markets.” Elon Musk, the founder of electric vehicle firm Tesla Inc (NASDAQ: TSLA), and SpaceX is known for moving markets positively or negatively depending on the tone or direction of his tweets per time. Bonnefous believes the Evergrande news is stirring an overreaction in the digital currency ecosystem as a whole.
“The crypto markets seem to be overreacting” to the headlines, and “the recent dip is probably more of a technical consolidation after the sharp rally of the last few days,” he said.
Bitcoin Price Crash Is Temporary
A number of top voices in the crypto ecosystem also believe that the current price crash is ideal for a new rebound to new highs.
Amongst the many factors being highlighted to fuel the growth of the nascent asset classes is the inflation fears in the US. The recent inflation data shows that the Consumer Price Index (CPI) topped 6.2% in October as reported earlier this week by Coinspeaker. This amongst many others factors may push people into investing in Bitcoin as a way to hedge investment portfolios against this inflationary surge.
“The recent shocking inflation numbers in the US should be a supportive fundamental driver for Bitcoin prices, beyond the short-term tactical selling pressure,” Bonnefous said.
Many price tops have been projected for Bitcoin to hit both in the short-term and by the end of the year. In the interim, the pullback being recorded can be taken as a yardstick for the next phase of the premier cryptocurrency’s growth.
Yesterday's retest was needed to continue the bull run in a healthy manner.
I think we will start pumping harder now.$BTC pic.twitter.com/WxkpoWljYu
— Galaxy (@galaxyBTC) November 11, 2021