On Tuesday, the cryptocurrency recouped some of its losses from the previous day. Bitcoin It briefly fell below $50,000 for the first time in six months.
The flagship cryptocurrency’s price recently rose 3.5% to $55,051.74, according to Coin Metrics. etherup more than 2% to $2,457.73.
Earlier on Tuesday, markets were rallying broadly, including stocks that were tied to the price of Bitcoin. Coin library, micro strategy and mining companies marathon numbers and Anti-riot platform Both were up about 2% in pre-market trading.
The sell-off occurred as cryptocurrency traders got caught up in a storm of arbitrage trader liquidation, rising fears of a U.S. recession, escalating tensions in the Middle East and growing uncertainty over the outcome of the U.S. presidential election.
Bitcoin bounces back from Monday’s sharp sell-off
For much of the day, Bitcoin was trading below the $55,000 floor that has supported Bitcoin for much of the year as it struggled to regain its March highs. Investors say the case for holding Bitcoin for the long term and its setup for the rest of the year has not changed. Matt Hougan, chief investment officer at Bitwise Asset Management, said that while this may be painful, it is a buying opportunity.
“We had a sell-off in global capital markets over the low-liquidity weekend that impacted the cryptocurrency market, but nothing fundamental has changed for Bitcoin or cryptocurrencies, except that we are closer to a Fed rate cut and we are closer to quantitative easing.” , he told CNBC. “I think this is more of a catalyst than a headwind.”
In August, Bitcoin and Ethereum fell by 16% and 25% respectively. This year, they grew 29% and 7% respectively.
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