Bitcoin is down ~55% from its December US$20,000 peak
Bitcoin reached its absolute high of ~US$20,000 in December last year as futures became available and rumors of Wall Street eyeing the crypto market for massive investment opportunities were all over the place. For several years in a row now, each start of a new year brings a drop in price for all cryptocurrencies because the Chinese new year is getting close and the US citizens need to pay their taxes. Up until late February it would be normal to see all coins lose some value with the need to transform cryptocurrencies into fiat, but other external and political factors may further influence the prices in a negative way.
Maybe the drop to US$11,000 was easily predictable, but Bitcoin is now sitting at around US$8,600 and this certainly has ties to outside factors. Earlier in January, the South Koreans threatened to ban cryptocurrency trades, but, thankfully, this was avoided. Meanwhile, hackers managed to steal more than US$500 million from Japanese exchange Coincheck, Facecbook announced that all crypto ads will be banned for fear of scams, the US Securities and Exchange Commission (SEC) announced the immediate shut down of Evander Holyfield’s AriseBank project that amassed over US$600 million, and, last but not least, Tether is in trouble.
Tether is another cryptocurrency that is tightly related to the value of the US Dollar. The current problems Tether is facing involve its inability to connect the market cap to conventional banking systems and the insolvency of the assets. Apparently, many Bitcoin traders use Tether as a substitute for fiat currency and if Tether fails to generate the needed solvency, exchanges could take a big hit.
Financial minds have already predicted that BTC could go over US$100,000 in just a few years and this may very well be the last time when Bitcoin's price is under US$10,000.