For the exchange, there is currently a realignment between supply and demand.
China and an overstimulation of the market would be the causes of the latest drop.
The exchange of bitcoin (BTC) and cryptocurrencies, Binance, analyzed the recent collapse in the digital asset market and assured that such a correction does not necessarily mean that a downtrend has arrived. For the exchange house, this is a usual behavior in which the forces of supply and demand are readjusting.
Binance explained that, during an uptrend, such as the one the market is currently experiencing, various fixes may be submitted. The most recent would have been caused, among other factors, by power cuts to Chinese miners and an overstimulation of the market.
Corrections happen in the cryptocurrency market, but they don’t always lead to bear markets. Several corrections preceded the bitcoin run to its last all-time high of nearly $ 64,000 in April 2021, ‘detailed the exchange through a Article published on his blog in Spanish.
The exchange house recalled that the corrections like last week they are usually followed by recoveries. If this behavior is fulfilled, the market could resume the bull run that it has brought from last year. However, if the corrections were maintained, then a longer period of decline would have come.
As a background, Binance cited what happened in 2017 when BTC reached $ 20,000 per unit. After achieving that milestone, the first cryptocurrency on the market experienced several corrections that ended up becoming a bear market that lasted for two years.
Bitcoin up or down?
For the analyst of the cryptocurrency markets, Willy Woo, the uptrend of digital assets such as bitcoin it is intact. Despite the recent correction and subsequent volatility, the researcher considers that BTC is only “heating up”, that is, preparing for a much bigger climb.
Woo’s main argument is that the number of users interested in bitcoin is growing more and more, regardless of how it is trading in the markets. “BTC users have roughly doubled each year since its inception a dozen years ago,” Woo commented, according to a recently published article by CryptoNoticias.
A different point of view is that of the Venezuelan analyst Alberto Cárdenas, who recently indicated that the rise in the price of bitcoin it was due to extreme leverage. For the trader this leverage would already be dismantling so BTC would have a downward trend again That would take it to $ 20,000.