Bitcoin Climbs Above Critical Level Following Weekend Slide

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The summer is officially underway and investors are hoping the crypto winter may be coming to an end.

Bitcoin was off nearly 1% to $21,252.05 at last check on June 21, according to CoinGecko, but the world’s most popular cryptocurrency was up 6.1% in the past 24 hours.

That was in sharp contrast to the weekend, when bitcoin dropped as low as $17,592.78, marking the first time it had fallen below $20,000 since December 2020.

‘Boulevard of Broken Dreams’

“Convention is dissolving. #Bitcoin is evolving,” Michael Sayor, the bitcoin evangelist and billionaire CEO of MicroStrategy  (MSTR) – Get MicroStrategy Incorporated Report, tweeted on June 21.

Still, bitcoin is down 69% from its Nov. 10 all-time $69,044.77. Saylor and his company are on the hook as they are among the biggest losers in Bitcoin’s tumble.

“For the longest time, it seems Bitcoin hodlers were walking on the boulevard of broken dreams,” said Edward Moya, senior market analyst for the Americas with Oanda, using a variation of “hodl,” the term that stands for “hold on for dear life.” 

“The last part of this historic crypto plunge was not just a de-risking Wall Street moment as many traders start to have a super bad feeling about the economy,” he added, “but large parts of the crypto markets are seeing stress, including blockchain investments.”

Moya said that surging borrowing costs, margin calls, and excessive leveraged speculation helped accelerate the selling pressure over the past two weeks. 

‘Crypto is Not Going Away’

“The entire cryptocurrency market is seeing some buyers emerge as the selling pressure may have been overdone,” he added. “Crypto is not going away and some investors are starting to believe further downside might be limited.”

Cryptocurrency has been battered last month by the sudden collapse of sister tokens Terra USD, or UST, and Luna.

Last week, crypto financial services company Babel Finance said it was temporarily suspending withdrawals and redemptions in the latest blow to the cryptocurrency sector.

The Hong Kong company later said it had reached an agreement with counterparties on the repayment of some debts to ease short-term liquidity, Reuters reported

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In addition, crypto lender Celsius Network announced that it would suspend indefinitely various transactions, including withdrawals of funds “due to extreme market conditions.”

Asking the Questions

State securities regulators from at least five states are investigating Celsius Network’s decision to suspend customer redemptions.

Cryptocurrency’s price drop was a big item on Google, according to CryptoWall.com.

Crypto-focused personal finance advisers at the digital currency services company said the question  “why is crypto crashing” is the fourth-most Googled crypto-related question, with 23,000 average monthly searches. 

CryptoWallet.com said this question can be more topical and time sensitive, “as people might wonder what is happening within the crypto market in set given times, and the reasons why a certain cryptocurrency might be crushing can be various.”

“Generally, the reasons are very similar to why the regular currency market might crash, since social, political and economic factors influence the crypto market as well as anything else,” the company said in a statement. 

“Specific reasons can be inflation and rising interest rates, in addition to the rise in popularity of low-quality coins that have influenced the market as a whole.”

‘What is Cryptocurrency?’

The  most searched question by a wide margin was simple and direct: “What is cryptocurrency?”

This query racked up 121,000 average monthly searches, followed by “what is crypto?” with 31,000 average monthly searches, for a total of 152,000 searches each month.

The third-most searched question was “how to buy cryptocurrency?” with an average of 24,000 monthly searches.

“It is fascinating to see how much people still do not know about crypto, and also how much they’re willing to learn about it,” CreditWallet.com said. 

As the world enters a new era of personal finance and crypto is changing the way people might see money and spending, the company said, “people want to be as informed as possible, either to keep up with changing times, investing actual time and effort into crypto, or just due to curiosity towards a relatively new and fascinating phenomenon.”