The last six weeks have been some of the worst bitcoin has ever experienced. Despite only being around for roughly 12 years, the world’s number one digital currency by market cap has seen its fair share of dark days and radical price changes.
Last Month was the Worst Point in Time for Bitcoin
Initially trading for about $64,000 per unit in mid-April, the asset hit a massive snag that late last week, saw it shed approximately $30,000 off its price. Today, the currency has corrected somewhat and regained about $3,000, but this is small beans compared to all the coin has lost, and many are comparing the dips with those that occurred in 2014 and 2018. Thus far, the asset has lost more in the past month than it ever has before, and many crypto fans are already referring to this period as the “Great Unwind,” meaning the currency has lost almost all its 2021 gains.
And yet, despite bitcoin experiencing the worst month of its existence this May, many analysts believe that this is just a small step backwards and it is nothing different from what the currency has already experienced several times in the past. They also say that 2021 is not over, and that bitcoin is still on its way to “fresh highs.”
Among those speaking in favor of bitcoin is Paolo Ardoino, the chief technology officer at crypto exchange Bitfinex. In a recent interview, he says that the circumstances surrounding bitcoin today are completely different from those the world saw in 2018, as back then, the digital currency did not have the support it presently does. In an interview, he claims:
A fully decentralized finance stack has been quietly built during the crypto winter. Meanwhile, the backdrop of increasing institutional investment and retail adoption continues to gather strength, representing powerful facts on the ground. Big financial institutions and traditional fintech have recognized that bitcoin cannot be ignored.
This Will Get More People Involved
Others, such as Simon Peters of e-Toro fame, believe that the recent drop will be good for bitcoin in the long run in that it will inspire more investing and encourage new traders to get involved in digital assets. He explains:
Bitcoin, the largest crypto asset by market cap, dropped by 38 percent in May, having been trading above $58,000 at the start of last month. This means May was its worst calendar month on record, eclipsing the 35 percent drop seen in December 2013. However, both bitcoin and Ethereum are rallying. While short-term moves have seen volatility spike, the selloff has also created many opportunities for new investors to get involved in the asset class for the long term, with many buyers waiting on the sidelines and now deploying capital.
One of the analysts most bullish about bitcoin is “Plan B” on Twitter, who’s stock-to-flow model predicts it will hit a price of $288K in the coming future.