Bitcoin has been in a free fall for the past two days, and the leading cryptocurrency has seen its lowest levels since May. Bitcoin’s price dropped over 20% in just 1 hour yesterday. However, there have been huge declines in the entire cryptocurrency market, not just Bitcoin. For example; Ethereum fell more than 30% and Ripple dropped more than 24%.
In addition to the crypto money market, there is a serious decline in all global markets due to the COVID-19 outbreak. However, the fact that both the global markets and the cryptocurrency market have shown a great decrease simultaneously led to the questioning of Bitcoin’s “safe harbor” status. On the other hand, while the majority of the market is concerned, some names say that this is only a pre-half decline and that there is no need for fear.
For example, the major digital asset rating company Weiss Crypto Ratings said today that the decline is anticipated and usual.
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In addition to this, after this decline, many names expressed that the “value store” feature of Bitcoin was shaken, while ShapeShift CEO opposed the issue quite harshly. Eric Voorhees stated that Bitcoin is not only lost its value store feature because it has had a very bad day. John Lilic of ConsenSys also answered these comments, stating that his belief in Bitcoin and Ethereum is getting stronger than ever.
Gold and Digital Gold
On the other hand, Anthony Pompliano, co-founder of Morgan Creek Digital and a crypto advocate, expressed that Bitcoin follows the graph of gold in terms of price fluctuations. Pompliano used the following statements in his statements regarding the subject:
This is not because gold is a bad value store or lost its safe haven status after 5,000 years. Because gold has a liquid market and investors need liquidity compared to everything. The situation will not be different in Bitcoin.
In addition, Pompliano stated that these price movements emerged after a liquidity crisis and the increase in the dollar level in the market caused this situation. Expressing that the issue of liquidity is the same for Bitcoin, Pompliano said, “Bitcoin has a liquid market, so many people who hold it will sell it in cash because they need liquidity. In fact, most people sold the asset over the past week, so the price of Bitcoin has seen such a significant drop. ” commented.