Cryptocurrency Update: Bitcoin price today, December 30, tested the $46,000 level as it continued to fall amid investors becoming cautious due to the newly discovered Omicron variant of Covid-19. Both traditional and the digital markets have taken a hit as the Omicron variant continues to grip the world, inducing lockdowns again in many countries amid muted festivities. Bitcoin prices had previously risen this week and crossed the $51,000 mark after days, only to take a blow and go on the downward trajectory again as investors refrained from the risk markets. This also resulted in a fall in the consolidated global cryptocurrency market, barring Tether, as all major coins fell during the day.
At the time of writing this article, the price of one Bitcoin was trading at $46,966.71, data from global crypto tracking website CoinMarketCap showed. This was down by 1.53 per cent over the last 24 hours and by 3.14 per cent over the last seven days, as per data. The prices of Bitcoin have been constantly declining over the past week, seldom crossing the $50,000 mark due to a number of reasons.
Why are Crypto Coin Prices Falling?
Talking about the fall in Bitcoin prices, Nirmal Ranga, chief revenue officer at Zebpay said that the virus could disrupt global supply chain which has resulted in a panic among investors. Talking to News18.com, he said, “Investors have become a little cautious, and are shying away from investments such as cryptocurrencies due to the emergence of the Omicron variant. As the variant spreads across the globe, both traditional, as well as crypto markets, have taken a hit. The virus could potentially disrupt supply chains and global travel, and with several nations imposing lockdown-like restrictions, it could delay a global economic recovery. This fear has led to a degree of panic selling, which in turn has created downward pressure on the market. In addition to that, ESG (environmental, social, and governance), investing, and concerns over energy use have also contributed to the recent price fall seen across most major assets.”
Experts also attributed market correction as a reason behind Bitcoin’s fall despite the festive season, after it touched its peak months back. “The reason behind prices falling despite the festive season can be correlated to the market correction wherein, the market undergoes a decline of 10 per cent or more. Besides, liquidity often tends to move around the year-end or holiday season. Furthermore, the two ETF disapproval along with the tax deadline together too contributed to the price fall. Financial markets are cyclical, but I’m positive that the market will stabilize eventually,” said Tarusha Mittal, member of Blockchain and Crypto Assets Council (BACC) and COO and co-founder of UniFarm.
However, Darshan Bathija, who is a member of BACC and the CEO and co founder of Vauld said cryptocurrency prices had little to do with festivities. “Prices are a function of supply and demand. Currently, the demand for crypto was low because people are away for the holidays. Exchanges’ trading volume is low this week due to the Christmas weekend and the upcoming New Year weekend. Trading activity will likely recover next week when everyone’s back from the holidays,” said Bhathija in a note to News18.com.
He, however, said that a positive sign is that that Bitcoin prices will close at 6 to 7 per cent higher this quarter.
“At current prices, Bitcoin will close this quarter with a 6-7 per cent gain and the year with a 60 per cent gain. This is a positive sign heading into 2022. Another factor that will help the crypto market is clarity on regulations. We expect more information on crypto regulations from government authorities next year.” The Indian government is set to bring out regulations regarding cryptocurrencies to curb frauds.
What’s Next for the Crypto Market?
Speaking about the current cryptocurrency market trend, Edul Patel, CEO and co-founder at Mudrex , said, “We saw a range-bound movement across the cryptocurrency spectrum over the past 24 hours. The traded volumes remained almost steady. Most of the top cryptocurrencies witnessed a bit of a selloff. However, this was not a bearish momentum but a minor blip across the spectrum. In the absence of any aggressive institutional buying, we are likely to witness sessions of such minor selloff across the spectrum. Over the next couple of days, we might even see a turnaround as bulls would attempt to buy the dip. The support level for bitcoin is $46,000 and $3,600 for Ether. We are likely to witness a reversal if these two top crypto currencies bounce back from the support levels.”
The value of the global cryptocurrency market declined to $2.20 trillion at the time of writing this article, data showed. This was down by 2.36 per cent over the last 24 hours. The total crypto volume however increased slightly to $95.11 billion as traders looked to sell their assets. This was up by 0.43 per cent, as per data on CoinMarketCap.
“The next few days shall be crucial for us to be able to assess which side the market will trend, as currently much of it is moving sideways. While the macroeconomic environment with respect to regulation, technological development, and adoption remain positive, much of the sentiment will be driven by what the pandemic has in store for us moving forward,” said Ranga on the falling crypto market just ahead the beginning of the new year.
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