Bitcoin has been in trouble for weeks. We all know that prices have been dropping for the best part of the year, and FTX’s recent disappointing implosion has put the crypto market in disarray. Bitcoin has suffered the most significant blow, dropping well below the fairly standard price of $20,000.
It took some time for the world’s largest cryptocurrency to consolidate after the price drops in the past 12 months, and just when it was starting to get stable, the FTX news destroyed everything it was building.
News don’t look good. Experts believe that a further 20% price drop is expected if it fails to reach a key level. Traders are warning for a big discount coming soon as Bitcoin has stayed rigid under $17,000 for the past week or so.
Little to Celebrate
It may be the holiday season, but if you’re a Bitcoin trader, there’s little to celebrate. According to data from TradingView, Bitcoin is practically unmoved from the $16,700 mark over the weekend. There’s no bearish potential right now, with most traders believing a further drop is expected. Bitcoin has touched $16,300 on Tuesday, and while it has since recovered, it shows that drops down to $16K and possibly below are expected.
According to popular trader Rekt Capital, $17,150 is the level we should keep an eye on. If Bitcoin reaches it, it will help avoid further drops. However, if it continues to reject this resistance, then a 20% drop is expected in the coming weeks. Rekt Capital also said that there’s still time for Bitcoin to do a monthly close over this level, although a close below it won’t have a positive impact.
His negative outlook was balanced by Michael van de Poppe, CEO of trading firm Eight. By the end of the week, more US economic data is supposed to hit the Internet. Depending on it, Bitcoin can shoot for the $17,300 key level and in that way offer exciting short-term opportunities. If there’s no breakthrough, longs between $15,500 and $16,200 are expected.
FTX Ruined it All
The biggest culprit for the state of the crypto market right now is ex-crypto exchange FTX. In the latest development of this saga, FTX’s rival, Binance, continues to deal with FUD over the past weekend. Everyone’s trying to make a clear distinction between FTX and the crypto market. New traders often associate them, which leads to a bad outlook for Bitcoin and cryptocurrencies in general.
Everyone’s sending letters to its customers not to make a relation out of the two. For example, Greyscale’s CEO wrote that FTX was a failure of people, not a crypto failure. It’s a tale of deception through false documentation and narrative, which isn’t what the industry is trying to do. Cryptocurrencies have a much larger picture in mind, so FTX’s failure shouldn’t be associated with the crypto market as a whole.
Of course, it’s a painful mark that will have (and already has) long-standing repercussions on Bitcoin’s and crypto prices. We’re just hoping that it doesn’t last for long.