Cryptocurrency and Bitcoin investors are waking up to red candles across the board.
The first and foremost cryptocurrency took a nose dive with the altcoin market in tow. As a result, the total market cap shed over $14 billion dollars in the span of only a few hours.
Cryptocurrency investors have been quite antsy over the past few weeks, as the market price of Bitcoin had settled to trading within a small $350 range. This was the lowest volatility Bitcoin had seen since the summer of 2017 and had many in the cryptocurrency community itching for some action.
Those itchers got their wish this morning, but it probably was not in the direction they were hoping for.
Bitcoin kicked off the morning by plummeting from $6,600 to briefly trading at $6,260 within the span of two hours. The market leader has since retraced back to the $6,300 level, hovering only slightly above Bitcoin’s 2018 low of $5,800.
Since the beginning of October, the total market cap in the cryptocurrency market was fairly steady — moving between $225 and $215 billion — but lost $14 billion in only two hours this morning, bring it down to just over $200 billion total.
One interesting thing to notice about this morning’s four percent Bitcoin dip was that it followed a 3.5 percent loss in the Dow Jones and S&P 500 markets.
One of the most argued-over questions in cryptocurrency has always been: ‘Will the price of cryptocurrencies rise or fall in times of an economic recession?’ While today could hardly be considered an economic recession, it could better identify the correlation between cryptocurrency and traditional markets.
A recent survey conducted by Tom Lee and the Fundstrat team polled 25 large financial institutions and Twitter to get a better idea of the market sentiment and thoughts on the future of cryptocurrency. According to the study, 72 percent of financial institutions believe that the price of cryptocurrencies will rise in the event of an economic recession, compared to 59 percent of Twitter users polled.
There hasn’t been a true economic recession since the 2008 housing market collapse — which happened directly proceeding the advent of Bitcoin.
Do you think Bitcoin will quickly recover to the upside, or do you think we still have yet to see the bottom? Will cryptocurrency prices rise or fall in an economic recession? Let us know your thoughts in the comments below!
Images courtesy of Shutterstock, CoinMarketCap, TradingView.