The value of bitcoin plummets after the cryptocurrency’s wealthiest trader loses £590 million in a single day.
BITCOIN has experienced a massive meltdown, with the world’s wealthiest trader losing £590 million in just a few hours.
On January 6, the cryptocurrency dropped by nearly (dollar)6,000, dealing a new blow to Bitcoin traders.
On a spot Bitcoin exchange traded fund, investors have pointed to a crackdown on mining and blocks.
According to CoinDesk, at 10:45 p.m. on January 6, Bitcoin was worth £31,920.10.
The cryptocurrency, however, was trading at £33,915.55 at 7:29 p.m. on January 5.
Over the course of a day, the stock dropped by -5.88 percent.
Ethereum also plummeted between January 5 and 6, losing -3.34 percent of its value in a single day to £2,530.73.
A mystery trader, who owns the world’s largest share of Bitcoin, saw the value of their wallet plummet as a result of the crypto’s recent price woes.
On Friday, wallet 34xp4vRoCGJym3xR7yCVPFHoCNxv4Twseo had (dollar)16.29 billion (£12.28 billion) in cryptocurrency, according to BitInforCharts.
By Saturday morning, it had dropped to (dollar)15.45 billion (£11.65 billion), and by the evening, it had dropped to (dollar)13.81 billion (£10.41 billion), wiping out (dollar)2.48 billion in one day.
In less than a month, the trader’s stash has dropped in value by (dollar)5.5 million (£4.15 million).
It comes as the minutes of the US Federal Reserve’s December meeting were released, indicating that the central bank would reduce the number of bonds it holds as part of its supportive monetary policy.
“Overall, I believe the global markets have shown weakness in light of the recent Fed moves to raise interest rates,” Vijay Ayyar, vice president of corporate development and international at cryptocurrency exchange Luno, told CNBC.
“As a result, I believe yesterday’s drop is highly correlated.”
Yesterday, US markets fell, and all other risk asset classes, including crypto, suffered as a result.
“The last four weeks have seen some weak price action in Bitcoin and crypto, owing to a lack of interest demand, the holiday season, and potentially similar factors.”
Yuya Hasegawa, a crypto market analyst at a Japanese bitcoin exchange, told CNBC that the cryptocurrency could drop even more.
He predicted that if the upcoming December nonfarm payrolls data shows strong job growth, Bitcoin could fall to (dollar)40,000.
“The price pressure is expected to continue until the market fully prices in the tighter-than-expected future monetary policy,” he said.
Bitcoin could hit $100,000 in five years, according to Goldman Sachs, if more investors see it as a good investment.
“News from the Brinkwire.”