Bitcoin value has taken a drastic fall over the last week, dropping under $40,000 US which equates to a drop of over 15%. Ethereum has seen a similar decline, while other major coins, including BNB, XRP, Solana, Cardano, Luna and avalanche, have seen steeper declines, with
Solana and Luna crashing 30% since this time last week. The combined total for the losses to the crypto market are over $300 billion US.
Cryptocurrency markets have been steady for weeks leading up to these massive losses, which has sent shockwaves through the industry.
The worst is potentially yet to come as cofounder of BitMEX Arthur Hayes forecasts staggering losses in the not-too-distant future. Hayes is forecasting Bitcoin to crash to $30,000 US over the next two months and the price of Ethereum to drop as low as $2,500 US per Ether.
If Bitcoin was to fall under $30,000 US it would be its lowest price since the end of 2020 and start of 2021 and would put big Bitcoin purchases such as Elon Musk’s, the county of El Salvador and software company MicroStrategy deeply underwater.
Global analysts believe that crypto investors may be spooked due to economic uncertainty around the world. Asian stock exchanges are being influenced by the Covid outbreak in China which raises a lot of questions about its dependability as a global supplier. Then there is the conflict in Ukraine which is also disrupting resources and manufacturing across the continent.
Alternatively, the drop could be attributed to new bans imposed on Moscow, with the European Union banning cryptocurrency services to Russia. The newly implemented rule blocks all deposits to Russian crypto wallets.
Or it could be due to India’s cryptocurrency market, as a new tax rule was imposed on April 1. Indian citizens are now required to pay a 30 per cent tax on any profit generated from cryptocurrency and doesn’t allow offsetting gains with losses.