Bitcoin continues its bearish momentum, making it easy for optimists to worry about the digital currency as it continues to be tied to the rise and fall of US stocks.
In the early morning of May 8 (Vietnam time), Bitcoin price fell below the $36,000 mark, becoming one of the two most disastrous declines in the past 3 months. Analysts assess that the rise and fall of Bitcoin tied to the US economy will lower expectations for the world’s most popular coin.
At the time of this writing, BTC (Bitcoin’s exchange-listed token) is trading at $35,149, one of the three lowest levels since the start of the year. Compared to the price of more than $ 39,000 a few days ago, the most valuable digital currency on the planet has lost nearly $ 4,000, causing many investors to sit on the fire.
The plunge of BTC led to Ethereum, the second most valuable digital currency in the market, also falling to the bottom in a recent month. ETH is trading at $2,631, down nearly 17% from its peak of $3,300 in early April.
At the price drop a few days ago, Bitcoin dragged the entire cryptocurrency market down, including coins that have been trending recently. However, this morning, the digital currencies of the move to earn project showed signs of recovery in the context of the red price list. Both GMT, the governance token and GST – the in-game token of the StepN project are inching up, up more than 3% in the past 24 hours.
It is easy to see that in the last few months, the price of Bitcoin is associated with the rise and fall of US stocks. This is due to the fact that China banned Bitcoin mining, leading the world market to flock to the US. In addition, in the context of general economic instability, Bitcoin price is also affected along with the market.
But the fact that Bitcoin is tied to the US economy will limit its potential, according to an analysis on CoinMarketCap. Accordingly, investors are viewing Bitcoin as a technology stock, causing investment sentiment to be correlated with the stock market.
Previously, Wall Street’s acceptance of Bitcoin made the digital currency more easily tied to the stock indexes of the world’s largest economy.
The fact that Bitcoin depends on the up and down momentum of the electronic board makes the increase of this digital currency limited, it is difficult to break out like in the previous period.
Therefore, the Bitcoin price is unlikely to reach the $100,000 mark as many analysts expect. In addition, this currency is also unlikely to become a hedge against inflation if it continues to have close ties with the US financial system.