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Will crypto recover? Price prediction for Bitcoin, Ethereum and other cryptocurrencies


Bitcoin and other cryptocurrencies started regaining some value on Friday morning, after falling to a month-long low.

The world’s largest cryptocurrency has now climbed back to around $57,230, after falling below $56,000 overnight.

It is just nine days since Bitcoin reached its highest ever price of almost $69,000.

However, crypto has been on a downward trajectory since, and crashed three times in the space of a week.

Bitcoin has lost around 17 per cent of its value since its peak, and other major coins have followed suit. Billions have been wiped from the overall cryptocurrency market.

Ethereum is currently at around $4,100 after soaring past $4,800 last week. SolanaRippleCardano, Dogecoin and Shiba Inu all made similar losses.

Here is why crypto crashed, and whether it could recover.

Why has crypto been crashing?

Monday’s initial crash can be put down to multiple factors.

A major one is the US Securities and Exchange Commission (SEC) rejecting a spot bitcoin exchange-traded fund (ETF), which would likely have seen billions poured into the crypto market.

China has also ramped up its clampdown on Bitcoin mining, which helped cause the last crash earlier this year.

China’s National Development and Reform Commission said on Tuesday that it would consider “punitive electricity prices” for some crypto mines in the next stage of its crackdown.

The dollar has been strengthening against other fiat currencies this week, but also appears to be strengthening against crypto.

This is in part because interest rates are rising, which can drive down inflation.

Twitter’s CFO Ned Segal also made negative comments about cryptocurrency, which may have helped sway the market.

He said investing cash into crypto assets “doesn’t make sense” right now.

On top of this, there is also what has become crypto’s natural cycle. People tend to sell their assets off when they reach record highs, as happened last week, and big sales can cause value to drop.

Is it going to recover?

Plenty of investors and analysts are very bullish about Bitcoin’s future.

Dutch analyst PlanB has suggested a prior prediction Bitcoin could hit $135,000 by December is “still in play”.

The group has found success predicting cryptocurrency growth in the past.

However, others are more pessimistic, at least about its short-term future.

Matthew Dibb, COO and co-founder of Stack Funds, told CoinDesk that Bitcoin could continue to lose value.

“We have noticed some larger sales occur on Bitfinex as well as openings of new short positions,” he said.

“While liquidations so far are quite low by historical standard and funding rates are approaching flat, we could see a further cool-off in BTC for the short term as momentum is beginning to stall.”

John Iadeluca, founder and CEO of multi-strategy fund Banz Capital, told Forbes: “Bitcoin has been trading sideways within the $55-65,000 price ranges, similarly to its performance this past February to May.

“I personally don’t believe this is very positive for the price of Bitcoin.”

He added: “I believe namely if the price of Bitcoin falls past $50,000 that this would indicate negative cyclical attributes for Bitcoin price,” meaning this could indicate long-term decline.

Should I invest in cryptocurrency?

People invest at their own risk and cryptocurrencies are not regulated by British financial authorities.

All crypto investments are risky, but meme coins like Shiba Inu are particularly volatile, and you should be prepared to lose everything you invest.

The Financial Conduct Authority (FCA) warned in January: “Investing in cryptoassets, or investments and lending linked to them, generally involves taking very high risks with investors’ money.

“If consumers invest in these types of product, they should be prepared to lose all their money.”

Susannah Streeter, senior investment and markets analyst, Hargreaves Lansdown previously explained the risks to i.

She said: “On top of being extremely volatile, most cryptocurrencies are unregulated, which not only adds another layer of uncertainty but also means that investors have little or no protection against fraud.”

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