A bitcoin sign with a graphic in the background.
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Bitcoin and other cryptocurrencies rebounded on Wednesday after a brutal sell-off, with the world’s largest digital coin climbing above $ 30,000 again.
Bitcoin’s price traded up to $ 32,765 on Wednesday, according to Coin Metrics, up about 8% from the day. The smaller cryptocurrencies Ether and XRP also rebounded around 9% and 6%, respectively.
The crypto market saw significant sales Tuesday, with Bitcoin dropping below the $ 30,000 mark for the first time since June 22nd.
The break-in came after news that the New Jersey attorney general had issued a cease and desist letter to crypto-lending firm BlockFi instructing them to stop offering interest-bearing accounts.
The reason for the increase on Wednesday was not immediately clear. Cryptocurrencies are often subject to strong price fluctuations. Bitcoin, for example, rebounded to an all-time high of nearly $ 65,000 in April before halving in value in the months that followed.
The price of ether rose about 1.5% in the afternoon after Tesla CEO Elon Musk announced in an online event called “The B Word” that he owns part of the cryptocurrency as well as Bitcoin and Dogecoin.
“Dead cat jumps”
Vijay Ayyar, head of Asia-Pacific at the Luno cryptocurrency exchange, said Wednesday’s price move was likely a “dead hop,” with an asset briefly recovering from a sustained decline before sliding further.
Unless Bitcoin can rise above $ 32,000 to $ 33,000, Ayyar expects further drawbacks, with the top cryptocurrency potentially dropping to $ 24,000 to $ 25,000.
“We also saw broad market rallies across the board last night and I think crypto is just playing off with that,” Ayyar told CNBC.
“In general, there are many macro factors weighing on risky assets right now – inflation concerns, Covid, and with crypto we have more specific concerns such as: B. Much more regulatory oversight. “
Cryptocurrencies are on a downward trend as regulators around the world take increasingly tough cracks.
In China, authorities have tried to stamp out cryptomining, the process that validates transactions and produces new coins. Binance, the world’s largest crypto exchange, is facing increasing pressure from regulators in the UK, Italy and elsewhere.