- Bitcoin has slid below $28,000 after Fresh Regulatory Woes, freshly heated U.K. inflation data and a significant sell-off on Binance
- On Thursday, Bitcoin’s mining difficulty level jumped by 1.72% reaching a record high.
- After nine years of being inactive, a Bitcoin whale address sent 2,071.5 BTC ($60.7 million) out today.
- In summary, Bitcoin is bearish and currently carries a sell verdict.
Bitcoin has fallen by 3.13% to $28,321 in the 24 hours, expanding its weekly loss to 9%, according to CoinMarketCap data.
After reaching $31,000 less than a week ago, the price of Bitcoin has been declining steadily, which has caused the shares of associated stocks to drop significantly this week.
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MicroStrategy ($MSTR), which has 140,000 Bitcoins in its treasury, and cryptocurrency exchange Coinbase ($COIN) both saw a more than 6% decline in share prices.
The U.K. consumer price report, released early on Wednesday, revealed that inflation continued to hold at above 10% in March.
This made things worse among many who were expecting Western central banks to scale back or even start to reverse their series of rate hikes.
In this article, we examine what is going on with Bitcoin: Its rise in mining difficulty, the movement of its whales, and the possible reason for its recent flash dip.
Bitcoin Tumbles Below $28,000
In a series of publications detailing BTC’s fall from what appeared to be safe heights above $30,000, Mark Connors, the head of research at Canadian crypto asset management 3iQ, said that,
U.S. crypto regulatory difficulties had been seriously affecting Bitcoin.
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According to CoinMarketCap, Bitcoin was last trading at roughly $28,100, down about 3% over the previous day.
This drop extended a two-day slide that began early on Wednesday amid freshly heated U.K. inflation data and a significant sell-off on Binance. BTC is down roughly 10% from its high last week of over $31,000, with investors more worried than optimistic about the future of crypto assets.
Despite good first-quarter earnings from several large banks, investors are nonetheless carefully on the lookout for the decline of several crucial economic indicators that might foreshadow a recession.
Recent employment reports have shown a slowdown in the raging labour market, and on Thursday, the National Association of Realtors released its monthly report, which revealed that home values had fallen by the most since 2012 and that mortgage rates had risen.
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Overall, Connors says that as U.S. regulation dampens expectations and causes numerous businesses to reboot their regulatory frameworks, we could be entering a time of Bitcoin consolidation.
Hashrate Increases as Mining Difficulty Rises by 1.7%
On Thursday, Bitcoin’s mining difficulty level jumped by 1.72%, reaching a record high.
The difficulty, which measures how much processing power is needed to award miners with Bitcoin, has historically changed every two weeks or so.
According to statistics, the mining difficulty reading increased by 2.23% from the last adjustment on April 6 to 48.71 trillion at block height 786,240 on Thursday.
According to further data from BitInfoCharts, the profitability rate of Bitcoin mining was $0.0646 per terahash per second during the previous 24 hours, down from US$0.2 from a year ago.
Bitcoin’s hashrate, was also about 355.4 exahashes per second on Wednesday, up from 338.3 exahashes on April 6 according to Blockchain.com.
Bitcoin Whale Transfers $60 Million
After nine years of being inactive, a Bitcoin whale address sent 2,071.5 BTC ($60.7 million) out today.
According to a tweet from the on-chain analytics platform, Lookonchain, the recently awakened address acquired its 6,071.5 Bitcoins on December 19, 2013, when one Bitcoin was only worth $663.
And the 2,071.5 $BTC was finally transferred to the address starting with "bc1q".
— Lookonchain (@lookonchain) April 20, 2023
Although the motive for the transfer is unknown, there is some speculation that old crypto users are merely transferring their old cash to new wallets, in response to an alleged wallet-draining exploit that appears to target older wallets.
Bitcoin Price Analysis
Bitcoin has entered a heavy decline from $31,000 and is now trading below the $28,000 zone after breaking below its 20-day moving average on Thursday.
With the third red candle in a row appearing on its daily chart, the cryptocurrency appears to be venturing further into bearish territory.
An ascending trendline can be drawn on Bitcoin’s daily chart. Throughout the last quarter of 2022 until mid-March, this line has kept the price of the cryptocurrency down.
However, Bitcoin broke through to the topside around $26,000 and has been trending upward ever since.
Bitcoin’s decline from $31,000 has brought it into a retest of this line, and the cryptocurrency’s next price action remains to be seen.
This is without mentioning that Bitcoin’s RSI on the daily chart shows that the cryptocurrency has declined into bearish territory.
If Bitcoin breaks through this trendline to the bottom side, it is expected to decline further down to the 50-day moving average of around $26,700. The further decline will bring the cryptocurrency straight down in a heavier dip.
The summary pane on Bitcoin also shows sell verdicts on the moving averages and a neutral stance on the oscillators.
Overall, Bitcoin currently carries a sell verdict.
Disclaimer: Voice of Crypto aims to deliver accurate and up-to-date information, but it will not be responsible for any missing facts or inaccurate information. Cryptocurrencies are highly volatile financial assets, so research and make your own financial decisions.