Bitcoin drops close to $30,000 mark as head-turning rally stalls
Bitcoin neared the closely watched price threshold of $30,000 as it continues to retreat from the record highs reached during a furious rally over the past two months.
The world’s largest cryptocurrency traded at about $31,350 in Asia on Friday, after a slide of almost 11% a day earlier. Commentators have cautioned that a sustained drop below $30,000 could presages further losses in the wake of last year’s 300% surge.
“This level looks very vulnerable and a break below it is bad news in the near-term for Bitcoin and cryptos in general,” Craig Erlam, senior market analyst at Oanda Europe, wrote in a note Thursday. “I wouldn’t be surprised to see a test of $20,000 before too long.”
Bitcoin has seen a stellar rally as prices more than doubled after passing $20,000 for the first time in December. It broke above $30,000 in early January before peaking close to $42,000. Volatility then picked up as the digital asset tumbled.
The crypto boom has proved controversial, cheered on the one hand by believers who see Bitcoin becoming a more mainstream investment, but decried by others that see little more than speculative mania.
Grayscale Investments, which is behind a popular Bitcoin trust, saw total inflows of more than $3 billion across its products in the fourth quarter. Just this week, BlackRock Inc. dipped its toe into the crypto universe for the first time, saying cash-settled Bitcoin futures are among assets that two funds were permitted to buy.
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