The Bitcoin (BTC) price fell again today after losses in the stock market, geopolitical tensions and the prospect of rising interest rates weighed on sentiment in the digital asset market. However, some hope that the worst is now behind us, and a leading institutional investor reminds Bitcoiners that network growth matters in the long run.
In both cases, BTC today fell below the level of USD 40,000 for the first time in two weeks and is now fluctuating around this level. At 17:38 UTC, BTC is trading at USD40,127 and is down 4% in one day and 8% in one week. BTC has also fallen by over 20% in a year.
Remarkably, the decline for Bitcoin happened when the price of gold in the market rose in a rally fueled by fears about an escalation in the Russian-Ukrainian conflict. However, it is worth noting that the recent rally for gold, after a period of consolidation lasting almost a year, occurs mainly between the levels of USD 1,700 and USD 1,900.
At the time of writing, gold was at $ 1,894 per ounce, having previously reached a high of $ 1,902. Today’s high marks the first time since June last year that the yellow metal has moved above the psychologically important level of $ 1,900.
Since the beginning of the month, the price of gold has now risen by almost 6%.
Meanwhile, Jurrien Timmer, director of global Macro at asset management giant Fidelity, offered some hope to BTC holders today.
“Bitcoin has been in a choppy trading range for almost a year, jumping between [USD]30k and [USD]65k,” Timmer tweeted, noting that price discussions continue to be “a favorite hobby for many,” “The network itself is more important. “What matters most is where the demand curve is going, and the answer continues to be “up and to the right,” Timmer said, sharing a number of other reasons why he remains bullish on the number one cryptocurrency.
In addition, Glassnode data showed that long-term holders (LTHs) have been buying BTC 3m since January 2021. Meanwhile, Marcus Sotiriou, an analyst at digital asset broker GlobalBlock, said that developments in Ukraine continue to have a big impact on the Bitcoin price.
“After yesterday’s increased tensions between Russia and Ukraine, global markets fell, with Bitcoin falling by almost 10%. Bitcoin closed the day under an important uptrend, as a bearish divergence of the [Relative Strength Index – RSI] also played out in the daily time frame,”the analyst said in an e-mail comment. He added that “all eyes are on the situation between Russia and Ukraine in order to achieve short-term relief in the market. Sam Bankman-Fried, CEO of crypto exchange FTX, said in an interview with Business Insider earlier this week that a crypto “autumn” – but not a widely feared “winter” — could be upon us. In addition, he said that the policy of the US Federal Reserve (Fed) remains “one of the core drivers of market movements” in the short to medium term.
“I don’t think it’s really winter. We’re still seeing a lot of activity in this room and a lot of excitement,” Bankman-Fried was quoted as saying.
An “autumn” could instead be a better way to think about it, the FTX boss suggested, before noting: “Certainly there has been a slowdown.”
Also somewhat pessimistic about the short-term prospects of Bitcoin was the experienced trader and technical analyst Peter Brandt, who shared on Twitter his frustration with “cheerleaders who constantly beat the drums of”to the moon”.”
Instead of implying “instant results”, Bitcoin promoters should teach newcomers, that “the big gains in Bitcoin will go to those investors who are willing to undergo periodic woes,” Brandt said in response to a comment from on-chain analyst Willy Woo.
Finally, a recent survey by Deutsche Bank, published this week in a report titled *The Future of Cryptocurrencies *, said that a majority of the crypto investors surveyed would continue to hold even if prices fell by 80%. Based on responses from 3,250 American consumers in December, the bank found that nearly half of those who said they hold crypto have become so successful that they were either considering quitting their jobs or had already quit. In addition, a quarter of respondents believed that Bitcoin will trade above USD in five years, the report says.