After witnessing a free fall for weeks, Bitcoin finally managed to rebound past $20,000 per digital coin on Monday, with around a 16 per cent gain over the weekend.
The rally came after Bitcoin, the largest cryptocurrency by market capitalisation, dropped below $18,000 per digital coin on Sunday, a massive drop of over 70 per cent from its record high of $68,000 in November last year, as mayhem in the crypto market continued.
The global market cap of cryptocurrencies sank below $850 billion, which until recently hovered over $1 trillion.
The second-largest cryptocurrency Ethereum also fell below $1,000 on Sunday, down by nearly 80 per cent since its all-time high in November last year. On Monday though, Ethereum also rebounded to reach $1,133, a 20 per cent gain over the past 24 hours.
The latest crypto crash is happening as investors are afraid of global macroeconomic conditions and the US Federal Reserve is trying to curb rising inflation.
According to analysts, Bitcoin may hit a grim $14,000 this year. The likely bottom range at $14,000 would represent a drop of around 80 per cent for Bitcoin from the $68,000 all-time high. According to Coindesk, Bitcoin has historically experienced periods of asymptotic price run-ups followed by steep crashes, ‘typically played out over several months to two years.’ Cryptocurrency watchers refer to these periods as ‘cycles.’
Overall, the prices of top cryptocurrencies declined as much as 35 per cent last week in the wake of economic recession fears.