310,000 liquid players and 6.5 billion lost! Bitcoin, the worst start to the year in 10 years

Bitcoin is facing its worst start in 10 years.

Since the beginning of the year, the trend of Bitcoin has been tragic. Data from OKEx shows that Bitcoin has reached just six trading days since 2022, with an 11.5% drop, marking its worst start since 2012.

Bitcoin has already lost more than 10%, of which 6.34 billion was lost

After the crisis that occurred on January 21, Bitcoin fell to over $39,000 on January 22 and fell below $36,000 for the first time since July 2021.

On the morning of January 23, Bitcoin fell again and many traders finally got into business. According to Bitpowder data, as of 1 p.m. on January 23, more than 310,000 people across the entire network are operating in a single day, and about 6.34 billion yuan in total revenue.

On November 10, 2021, after the US government cleared the Bitcoin Futures ETF to go public, the price of Bitcoin hit an all-time high of nearly $69,000 and then fell completely. Mountain peak.

Since the beginning of the year, Bitcoin has suffered various declines. Data from OKEx shows that Bitcoin has risen in six trading days since 2022, dropping 11.5%.

At 3 a.m. on January 6, the Fed announced its announcement at the December FOMC meeting. The Fed may raise rates faster and faster than expected, and a declining balance sheet may follow. After the release of the Federal Reserve's morning session minutes, bitcoin's plunge got even worse, with the index dropping 7% at one point, falling to at least $42,535.

On January 7, Bitcoin continued to fall, losing 3.5% of one point to $41,598.86.

It should be noted that on December 4, 2021, the Bitcoin index suddenly dropped, dropping 20% ​​at one point, reaching a low of $42,587 each.

Why Bitcoin lost?

The volatility successfully indicates the market behavior of the cryptocurrency outlook for 2022. In the past, many market analysts believed that the $40,000 mark was a strong support level for Bitcoin, but Bitcoin fell below the mark of $40,000 for the second time this month.

Some analysts have suggested that there could be a range of effects after the cryptocurrency crash, including expectations of Fed rate hikes (short-term interest rates) and expectations of rapid acceleration. Dangerous events also include the pursuit of the new Omicron virus.

Meanwhile, Bitcoin has risen around 60% in the past year and outperformed other stocks, boosted by demand from adopters, inflation hedging and diversified investments.

Soaring inflation, on the other hand, is forcing central banks to tighten monetary policy, and policymakers plan to tighten monetary policy sooner than previously thought, so-called risky assets may fall.

Also recently, cryptocurrencies have faced more bad news. Bitcoin miners in Kazakhstan have halted their operations.

Salvadoran President Announces Bitcoin Offering

On January 22, El Salvador's Central American President Ibrahimovic Bukele announced on social media that El Salvador had bought 410 BTC at a loss.

According to the Xinhua News Agency, on September 7, 2021, Bitcoin officially became the fiat currency of El Salvador, making it the first virtual currency to gain fiat status in a country.

The Salvadoran parliament passed a bill recognizing Bitcoin as a fiat nation on June 9, 2021. Salvadoran President Nayves Bukele also announced in a press release that the Salvadoran government purchased 400 bitcoins. At the time of the tweet, the total amount of El Saldova cryptocurrencies will be around $20.9 million.

In the past, international financial institutions such as the World Bank, the International Monetary Fund (IMF) and the Inter-American Development Bank have expressed concern over the financial risks posed by El Salvador's actions. According to the International Monetary Fund (IMF), some countries may use cryptocurrencies as their currency. Cryptocurrencies can have advantages such as security, accessibility, and low transaction costs, but often come with higher risk and cost than national returns. advantage capacity.