"Cocktail of uncertainty" is causing Bitcoin to crash
Fueled by Donald Trump, Bitcoin has recently experienced a boom. However, the cryptocurrency is once again demonstrating its volatility: the price has reached its lowest level in months. The situation is no better for the Bitcoin alternative, Ether.
Bitcoin is continuing to lose ground with a generally gloomy mood on the financial markets. The price of the oldest and best-known cryptocurrency fell to $51,600 on the Bitstamp trading platform, reaching its lowest level since February. Since Friday evening, Bitcoin has lost about $10,000 in value. A comparable price drop last occurred in June 2022.
Last week, Bitcoin had already given way significantly. Analyst Timo Emden of Emden-Research spoke of a "cocktail of uncertainty" currently weighing on Bitcoin. "Especially the renewed recession fears in the US are catching investors off guard," said Emden. In recent weeks, the US has reported several disappointing economic indicators. In particular, an unexpectedly weak jobs report from the US government sparked concerns. In July, unemployment in the world's largest economy rose to its highest level in nearly three years.
The second-largest cryptocurrency, Ether, was also hit hard. The price of Ether plummeted by around 15 percent to $2,340. This also means a setback for the newly launched Ethereum ETFs, which were intended to attract new investors in the US. With the latest price losses, the market capitalization of all cryptocurrencies has significantly decreased, falling by about 14 percent to $1.85 trillion. The share of Bitcoin was last estimated at about 56 percent. Last week, Bitcoin had risen to just under $70,000.
Statements by Republican presidential candidate Donald Trump had driven the cryptocurrency towards a record high, which was last reached in March at just under $74,000. Trump had promised to make the US the "crypto capital of the planet and the Bitcoin superpower" if he returns to the White House after the November election. The price development over the past week once again shows the volatility of trading in cryptocurrencies. Therefore, warnings about possible significant price losses with Bitcoin and Co. continue to be issued.
Other cryptocurrencies, like Ripple and Litecoin, have also experienced significant price drops, mirroring the trend in Bitcoin and Ether. Investors are now turning their attention to other potential safe havens, seeking to diversify their portfolios beyond the volatile cryptocurrency market.
