Bitcoin falls to the 30,000 mark: what’s behind the bear market?
As of this writing on May 10, 2022, Bitcoin (BTC) prices are hovering below $31,000, recovering slightly after briefly dipping below $30,000 on Monday night.
Crypto “Big Brother” prices fell as the Federal Reserve’s monetary policy turned “hawkish”, U.S. interest rate hikes and fears of a global recession sparked a larger market sell-off.
Monday’s price drop hit bitcoin’s 10-month low and its lowest price this year.
The last time Bitcoin fell below the $30,000 mark was on July 20, 2021, but the price quickly rebounded.
Bitcoin price trends appear to be in line with the broader movement in global stock markets, especially in tech stocks.
The Nasdaq 100 rebounded slightly after falling to its lowest level in two years.
S&P 500 futures saw a similar recovery after the slump.
As Wall Street continues to tumble in a “bloodbath,” traders are trying to figure out whether bitcoin and cryptocurrencies, in general, can stabilize sooner than the stock market.
As usual, altcoins generally follow Bitcoin, with ether (ETH), ripple (XRP), Solana (SOL) and many other cryptocurrencies falling to their lowest levels this year.
So, where does the future of cryptocurrencies go?
The impact of U.S. monetary policy
Last week, central banks around the world, including the United States, Britain and Australia, raised interest rates to curb inflation.
Investors are now panic selling out of fears that persistent inflation and rising borrowing costs could slow global growth.
The Fed’s influence is particularly widespread.
The US central bank raised interest rates by the most in more than 20 years, raising the benchmark rate by 0.5 percentage points.
The next rate hike is likely at the next meeting in June. But ahead of the US midterm elections in November, the Fed’s hawkish approach may be tempered by easing pressure on economic concerns.
While Bitcoin and cryptocurrencies are touted as “safe haven assets” against inflation, their “safe haven” utility is not well represented and tends to correlate with tech stocks.
Regardless of the outcome, there are always ways for cryptocurrency traders to profit from a prolonged “bear market” or “crypto winter.”
How to make money in the cryptocurrency ‘cold winter’
Seasoned traders know that bear markets, like bull markets, are great opportunities to make money.
Gains can be achieved by using different trading strategies, such as shorting, profiting from price declines, or long-term holding a diversified portfolio of digital assets including crypto indices.
The one-stop platform Binance provides a variety of trading tools, whether the market is up or down, you can use it as you like and make profits easily.
In addition to low fees, advanced analytics and trading strategy guides, Binance also features a “Bitcoin Cloud Mining” tool that continues to offer Bitcoin rewards to active users regardless of market conditions! To learn how to use Binance to profit in the cryptocurrency “cold winter”, it only takes a few seconds to register an account, open a demo account, and try various trading strategies with zero risk in real market conditions!