Bitcoin Hits Two-Month Low as Crypto Bubble Deflates Amid SpaceX’s Write-Down

In a striking blow to the once-booming cryptocurrency market, Bitcoin, the poster child of digital assets, has plummeted to its lowest value in two months. This dramatic fall comes in the wake of the spectacular failure of Sam Bankman-Fried’s FTX exchange, further solidifying the bursting of the crypto bubble that had held the financial world in thrall.


Today, according to a report by Reuters, Bitcoin’s value reached its nadir since June 16, hitting a morning low of $26,172. The slight reprieve from this decline appeared on Thursday when the cryptocurrency saw a staggering 7.2% drop, marking its lowest valuation since November 2022. However, a temporary resurgence was noted at 4:35 a.m. Eastern Time, where the digital currency managed a modest rebound to $26,441.


The catalyst for this downward spiral appears to be news that Elon Musk’s SpaceX wrote down the value of its Bitcoin holdings by a staggering $373 million. Ben Laidler, a global markets strategist from eToro, described the SpaceX announcement as an “immediate catalyst” for the depreciation in value. This isn’t the first time Musk has seemingly influenced the crypto market, as he has previously faced allegations of insider trading and legal battles over his attempts to inflate Dogecoin’s price.


Contrary opinions, however, suggest that Bitcoin’s slide is linked to factors such as low volatility and waning interest from retailers. These elements have contributed to a growing sense of caution within the market, as retailers and investors reassess their positions.


The freefall in Bitcoin’s value is a reminder of its historical volatility. Despite its global adoption and substantial gains, a considerable portion of Bitcoin investors continue to experience losses. The Bank of International Settlements’ recent working paper asserts that a significant 73 to 81% of new crypto speculators inevitably lose money following their initial investment. This majority predominantly comprises “risk-seeking” young men under the age of 35, who are drawn to cryptocurrency as a means of quick financial gains.


As the crypto bubble deflates, Bitcoin’s current downturn serves as a stark reminder of the inherent risks within the cryptocurrency market. Investors and speculators alike are now facing the sobering reality that the seemingly boundless upward trajectory of digital assets is, in fact, a realm of extreme volatility and uncertainty.

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Crypto Stats

CryptoCurrencyUSDChange 1hChange 24hChange 7d
Bitcoin63,349 0.50 % 1.70 % 9.39 %
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Toncoin7.250 0.03 % 0.64 % 0.79 %
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