Bitcoin crashed close to ten percent just hours after breaking the record from 2021. Crypto expert Vetle Lunde is very positive about the fall.
Senior analyst Vetle Lunde in K33, formerly Arcane Crypto. Photo: Siv DolmenPublished: Published:
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– The fall is a very healthy and necessary movement after the “all-time high”, and if this had taken root, there would have been a lot of leverage in the market. The correction was timely and a washout that will add much more weight to bitcoin.
That’s what K33’s senior analyst Vetle Lunde says about the development in the world’s largest cryptocurrency.
On Tuesday afternoon, the bitcoin price reached a new high of $69,013, breaking the previous record from 2021. Then, bitcoin plunged close to ten percent later in the evening. On Wednesday morning, the price is just under 65,000 dollars.
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Lunde believes the market was in an unsustainable state before the sharp fall took place.
– Unhealthy condition
Before the record was broken and in the days leading up to it, a significant leverage against further price increases had built up, according to Lunde.
– The market was in an unhealthy state, with the consensus that bitcoin will almost collapse, after the cryptocurrency has done very well in recent months and especially weeks. The focus in the market becomes enormously one-sided, and “everyone” positions themselves for further growth.
Such a development is quite typical, the analyst believes, and refers to similar movements from 2017 and 2020.
Going forward, Lunde believes that bitcoin will break the “all-time high” for real – without a new correction, in the relatively near future such as during April.
– But the market must normalize. The ETF bit, the halving and general interest pave the way for further growth, says Lunde.
Senior analyst Vetle Lunde in K33 is positive about the bitcoin fall that came after a new top listing on Tuesday. Photo: Siv Dolmen
A cocktail for demand
Since the new year, the price of bitcoin has risen sharply. Both the 50,000 and 60,000 dollar milestones were passed in February.
An upcoming reduction in the supply of bitcoin, also known as a halving, has contributed to a rally in the market, Bloomberg wrote in late February.
In addition, the US Financial Supervisory Authority (SEC) approved trading in a number of bitcoin products at the start of the year. Thus, bitcoin-ETFsbitcoin-ETFsAn exchange-traded fund (ETF) is a collection of securities. EFTs are traded on a stock exchange, in the same way as shares. listed and traded on Wall Street, in the same way as a share.
Scandals
The cryptocurrency is known for large fluctuations, and has been affected by a number of scandals.
At the end of November last year, the head of Binance, the world’s largest crypto exchange, resigned after pleading guilty to violating US money laundering laws.
The year before, the crypto exchange FTX went bankrupt. Founder Sam Bankman-Fried was later found guilty of fraud. His defense attorney Mark S. Cohen has told E24 that Bankman-Fried maintains his innocence and will continue to fight the charges.