Bitcoin and other cryptocurrencies fell Wednesday, underperforming other risk-sensitive assets and giving up some gains from a big rally over the past month. The very foundations of that rally may be less solid than they seem, said analysts at J.P. Morgan. The price of Bitcoin has retreated 2% over the past 24 hours to $35,800, having recently dipped as far as $35,250, the largest crypto’s lowest level in more than a week. Bitcoin continues to fall back from its recent, 18-month peak near $38,000, which marked the high point of a rally that carried prices one-third higher in a month, spurring calls of a new bull run and ending a multi-month period of calm in crypto markets.
“Bitcoin continued its correction … which at one point seemed to get out of control,” said Alex Kuptsikevich, an analyst at broker FxPro. “The burst of optimism in traditional markets bypassed cryptocurrencies … perhaps the most acute question is whether the cryptocurrency market’s counter-trend dynamic indicates risk demand exhaustion or an attempt at a quick correction to continue following equities.”
