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Bitcoin Drops as the Crypto Winter Gains Momentum

Simar Marwaha
Simar Marwaha

Updated on January 16, 2023 11:00 AM

Published on December 29, 2022 03:53 PM

Bitcoin's price has been bouncing in a fairly narrow range as the new year approaches, providing little insight into the direction of the next large increase. Read on since that is summarised in this article!

Bitcoin Drops as the Crypto Winter Gains Momentum
Source: Unsplash

Recent trading saw a little decline in Bitcoin as investors maintained their traditional year-end slumber. Near the levels they've held for the majority of the last two weeks, cryptocurrency prices are still locked.

The biggest cryptocurrency by market capitalization was trading at $16,700 recently, down 1.3% over the previous day but still close to its most recent support level of just under $17,000. Despite the growing consequences of the collapse of the cryptocurrency exchange FTX, the price of BTC has stayed steady over the last two months.

Also read: No Bitcoin Rally on this Christmas, Investors Hoping for the Next Year

Bitcoin Roll-out

Simply said, supply and demand have an impact on the price of bitcoin just like they do with any other traded item. However, the occurrence of a few significant worldwide events might affect the price of bitcoin: For instance, the demonetization of Indian banknotes in 2016 had a favourable impact for Bitcoin. The price of cryptocurrencies was 20% greater in India than it was anywhere else.

Going back in time, the 2019 bull run could be connected to Facebook's announcement of the Libra project. Bull-run started losing steam as reports about the difficulty of the Libra regulation began to surface. Along with significant world events, there are certain Bitcoin heavy-bag owners, commonly referred to as Bitcoin Whales. They possess thousands of BTC, which is sufficient to produce big daily price moves.

Since November 1, MicroStrategy has spent a net $44.6 million to increase its holdings of bitcoin by roughly 2,501. Recently, there was the first sale of a tiny quantity of the biggest cryptocurrency by market value by the software business that Michael Saylor, a proponent of crypto, co-founded.

As of the time this article was being written, the  price of one bitcoin is $16,595.65, a change of -1.04% over the previous 24 hours. After the most recent Bitcoin price movement, the market capitalization of tokens was $319,376,492,746.11. Bitcoin has had a shift of -64.08% so far this year. 

The price of bitcoin is notorious for being extremely unpredictable, yet despite this, it has grown by an astounding 9,000,000% between 2010 and 2020 to become the best-performing asset of any type (including equities, commodities, and bonds) during the previous decade. As Satoshi Nakamoto mined the bitcoin genesis block, the first ever block on the Bitcoin blockchain, at the beginning of 2009, 50 BTC entered the market at a price of $0.00.

Crypto Winter in regard to FTX

Documents submitted in a Caribbean court reveal that former CEO Sam Bankman-Fried borrowed hundreds of millions of dollars from Alameda Research to buy his interest in trading software Robinhood Markets, continuing the tragic and unsavoury story of FTX.

Before being arrested, Bankman-Fried allegedly admitted to borrowing $546 million from Alameda via promissory notes with FTX co-founder Gary Wang in an affidavit. They used that cash to fund the shell company, Emergent Fidelity Technologies Ltd., which in May acquired a 7.6% share in Robinhood.

Seven months after the TerraUSD (UST) stablecoin lost its anchor to the dollar, the FTX issue has rekindled calls for more regulation. The subsequent collapse of the Terra ecosystem in the spring prompted lawmakers to step up their attempts to develop more stringent regulations aimed at digital assets.

Little tangible progress has been made thus far, but many cryptocurrency insiders anticipate improvements to safeguard investors in the coming year and beyond.

Mainstream news outlets and pundits have frequently failed to provide their viewers with an honest appraisal of what transpired in the weeks following Sam Bankman-Fried's enterprise was exposed as a house of falsehoods.

Many important details concerning the affair have been revealed by August institutions like the New York Times and Wall Street Journal, but they have also often seemed to play down the details in ways that softened Bankman-intention Fried's and responsibility.

It is now obvious that what occurred at the FTX cryptocurrency exchange and the hedge fund Alameda Research featured a number of deliberate and purposeful fraud attempts meant to defraud both investors and users of their money.

Because of this, a recent New York Times interview received harsh criticism for appearing to blame FTX's downfall on poor management rather than criminal activity. It may be argued that a Wall Street Journal piece supporting Bankman-Fried's strategic philanthropic stance lamented the loss of charity contributions from FTX.

By attributing Bankman-Fried's funds to aiding Democrats in the 2020 elections, Vox co-founder Matthew Yglesias, a court chronicler of the neoliberal status quo, appeared to cover up his personal involvements while avoiding the possibility that the funds were actually embezzled.

Also read: FTX collapse made leaving currencies in the exchange risker

Bitcoin FAQs

How does Bitcoin make money?

By successfully verifying blocks and receiving rewards, the Bitcoin network of miners generates revenue. Through cryptocurrency exchanges, bitcoins may be converted into fiat money and used to make purchases from businesses that accept them.

Is Bitcoin a good investment?

The most valuable cryptocurrency by market capitalization, bitcoin, is a volatile and dangerous investment. It should only be taken into consideration if you have a high level of risk tolerance, sound financial standing, and the ability to absorb any potential losses.

Should a beginner invest in Bitcoin?

Since cryptocurrency is a very speculative market segment, many astute investors have chosen to divert their funds in other directions. However, the greatest recommendation for newcomers who want to start trading cryptocurrency is to start small and only use money that you can afford to lose.

Who owns Bitcoin?

Anyone may use Bitcoin, and nobody owns or controls it. Users and developers gathered in Bitcoin forums to contribute code and work on the project, which had evolved into a collaborative endeavour, even while Satoshi remained to direct its development.

What is a good amount to start bitcoin?

If you're still hesitant to buy your first Bitcoins, take these tips to heart to make the process go more smoothly: Any approved cryptocurrency exchange or broker accepts investments of even $10. You may start off in this fashion and have a better knowledge of what it means to be a bitcoin investor.

Is it possible to withdraw Bitcoin to a bank account?

If you own Bitcoin, you can sell it on Bitstamp for US dollars. After that, you can withdraw those funds to the bank account of your choosing by providing your bank information. Each withdrawal costs 0.0005 BTC on Bitstamp.

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