The total cryptocurrency market cap fell down by more than $200 billion as Bitcoin price value dropped to $30,229 and altcoins correctly sharply.
The euphoria in the cryptocurrency market was quelled on Jan.11 as the most of altcoins saw their price values in a decline trend by more than 20% as Bitcoin price sold off sharply.
After falling below the $40,000 support level on Jan. 10, selling pressure for Bitcoin (BTC) increased overnight and pushed the price value of the top cryptocurrency as low as $30,229 before a soft support level was reached.
The current rapid decline in price led to more than $2.7 billion worth of futures contracts being liquidated and the long candles on the Bitcoin price chart show that the course of liquidations occurred quickly as the price dropped from $41,000 to $32,229.
Dallas Mavericks owner Mark Cuban used the current market downturn as no chance to point out that the cryptocurrency market is identical to the internet stock bubble from the 1990s.
Cuban said that “Watching the cryptos trade, it’s exactly like the internet stock bubble,' yet he added that Bitcoin, Ether, and “a few others' may probably follow the path of Amazon and eBay and continue to see their valuations rise.
Those with a little more skin in the game, such as Celsius CEO Alex Mashinsky, feels the recent drop as a healthy price correction and necessary one. Mashinsky hinted that there is a chance of BTC dropping as low as $16,000 before continuing its upward trek.
The traditional financial sector also found itself under pressure on Monday as the political situation in the United States continues to generate tension and uncertainty about the future of the country and the economy.
The S&P 500, Dow, and the NASDAQ all completed the day in the red, down 0.66%, 0.29%, and 1.55% respectively as big-tech and the FAANG stocks hit their lowest levels since Nov. 26.
Each time BTC price falls by thousands of dollars, bears, doomers and nocoiners emerge from the nether escape to issue calls for the death of Bitcoin.
Taking into account that Bitcoin value rose from $17,586 on Dec. 11 to $41,950 in a short span of one month, David Lifchitz, CIO at ExoAlpha views this pullback as a “healthy correction by smart institutions who bought BTC from $20,000 on the way up to $30,000.'
Lifchitz told Cointelegraph:
“One worrying sign was not that the Bitcoin price was rising, but its velocity, i.e. the speed at which it did move. From mid-December to end of December 2020, the median amplitude of the daily moves in Bitcoin doubled to 8.1%, then it almost doubled again from Jan.1st, 2021 to Jan.10th to 15.3%. The larger the amplitude, the more exchanges took place through the day between buyers and sellers. This is a healthy correction though to purge the excessive growth of the last 10 days, allowing Bitcoin to build a new base toward $50k and above.'
According to Joshua Frank, CEO and founder of TheTie, an alternative data social analytics platform, the lack of Bitcoin Twitter mentions in December 2020 indicates that a small number of large investors were driving the price gains.
In private comments to Cointelegraph Frank said:
“On January third, both Bitcoin and crypto 24-hour tweet volume hit an all-time high. Retail interest has continued through the second week of January and monthly average Twitter conversations around Bitcoin are now at an all-time high in January. Unsurprisingly, this surge in Twitter activity has corresponded with a local top on Bitcoin.'
Ether (ETH) price value also got a hard hit by today’s downturn, dropping as low as $914 before finding support. ETH is down by 16.33% and trading at $1,033. Out of the top 50 cryptocurrency projects, the only token currently trading in the green on the day is Neo (NEO), up by 1.5% and trading at $22.52.
The overall cryptocurrency market cap now stands at $847 billion and Bitcoin’s dominance rate is 68.9%.