Bitcoin (BTC) dipped below the $9,000 threshold on Monday mimicking global markets, as investors faced fears of fresh coronavirus outbreaks around the world.
Bitcoin reached a peak at $9,200 during the early hours of cryptocurrency trading activity today but then fell sharply towards an intraday low of $8,934 per coin, even though it managed to recoup some of these losses later on and floated back above the $9,000. BTC is now trading at $9,118 in afternoon trading in London. The S&P 500 in New York opened 2% lower.
The wider crypto market recorded stiffer declines, with Ethereum, Ripple’s XRP, Bitcoin Cash and Litecoin all losing around 5% and wiping some $10bn from the combined value of the world’s cryptocurrencies, CoinMarketCap data showed.
US stock futures and Asian equity markets are both shedding points since they opened last night, amid news of a spike in virus cases in China and Tokyo after weeks of mild daily case volume reported by both countries.
Meanwhile, a number of US states, such as Florida and Texas, have reported a surge in virus cases, only 20 days after the country celebrated its traditional Memorial Day on 25 June, which saw people rush to lakes and other outdoor locations to enjoy time off after weeks of strict lockdown measures.
“I think it’s definitely part of the broader sell-off that we also saw in equities last week,” Vijay Ayyar, head of business development for Luno, a cryptocurrency exchange, told Bloomberg.
He added: “We tapped liquidity at the $10,000 level and are now coming back down. I expect $8,500 to hold, but if not we’re looking at $7,700 and then $7,100”.
The price of Bitcoin has been surging ever since the crypto asset reached a bottom during the February stock market sell-off at $5,485, fueled by a technical event known as the ‘halving’, which reduces the amount of the cryptocurrency available to be mined, pushing up prices as a result.
Since then, the cryptocurrency has seen a tremendous 66% jump based on today’s price of $9,125 per coin.