Cryptocurrency price crash update – Bitcoin rebounds 10% but Luna plummets 99% as investors urged to remain cautious
CRYPTOCURRENCY prices crashed yesterday but Bitcoin has started to rebound, although other coins such as Luna have continued to fall.
The price of digital coins plunged this week, with some investors losing their money in the crash.
Bitcoin’s price had plummeted to the lowest level since July 2021 but it has since begun to recover.
The cryptocurrency is up more than 10% this morning, according to trading platform Coinbase.
It’s hit $30,212.53 after dropping as low as $26,401 earlier this week.
However it’s only a partial recovery as Bitcoin is still down 24.47% this month.
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Despite the Bitcoin bounce back, investors should still be cautious.
Cryptocurrencies are extremely volatile, meaning their value can plunge within seconds and you could lose all of your money.
They can also be complicated and you shouldn’t invest in products you don’t understand.
You should also be wary of scams as cryptocurrencies aren’t regulated in the UK.
That means if you lose your money you won’t be able to get it back.
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Myron Jobson, senior personal finance analyst at Interactive Investor, said: “Whether the uptick in performance is indicative of a full-scale recovery remains to be seen.
“What direction the price of Bitcoin and other cryptos will follow is anyone’s guess, but they remain a swashbuckling ride for investors.
“The recent crypto slide is a timely reminder that shows that just because something has perceived value, it doesn’t mean it can’t end up massively overvalued and in a bubble.”
While Bitcoin is recovering, other cryptocurrency prices have dropped, such as Terra (LUNA), which is down 99% in the last 24 hours.
Investments in the coin, which was previously ranked among the top 10 most valuable digital currencies, have been wiped out in today’s crash.
The dramatic drop meant its market cap dropped from above $40bn (£32bn) to just $500m (£409m) – resulting in unprecedented losses for those backed the currency.
Why was there a crypto crash?
Bitcoin, and other cryptocurrencies like Ethereum, plunged in price this week, reflecting the global markets and fears over inflation and interest rate rises.
Bitcoin, the world’s biggest cryptocurrency, hit a low of $26,401 – below the level recorded in July 2021.
Even though the coin has rebounded above $30 today, the price is still below last year’s record high of $68,789.63.
Concerns over inflation and interest rate rises have affected the mainstream markets, having a knock on effect on crypto values.
The drop has also been prompted by regulatory crackdowns and bans in China and Russia.
Many crypto-mining regions in China are now radically reducing operations.
Previous moves by the country to crackdown on mining and trading of crypto has previously sent markets plunging.
And the unrest in Eastern Europe has contributed to the fall because investors tend to shun risk-sensitive assets during uncertain times.
Victoria Scholar, head of investment at Interactive Investor, said: ” “Equity market losses, concerns about inflation, and instability in the stablecoin market have sent shockwaves throughout the crypto complex this week, prompting fears of a ‘crypto winter.’”
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She said “opportunistic buyers have scooped up cryptos at a discount overnight”.
“Recent price action serves as an important reminder of the wild swings that are characteristic of the crypto market that can on the one hand can create outsized gains for traders and investors but can also lead to damaging losses.”
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|CryptoCurrency||USD||Change 1h||Change 24h||Change 7d|
|Bitcoin||0.73 %||2.72 %||0.79 %|
|Ethereum||0.81 %||5.14 %||6.96 %|
|Tether||0.13 %||0.12 %||0.60 %|
|USD Coin||0.14 %||0.19 %||0.29 %|
|BNB||0.64 %||1.97 %||10.38 %|
|XRP||0.72 %||5.93 %||3.16 %|
|Binance USD||0.25 %||0.27 %||0.24 %|
|Cardano||1.38 %||8.49 %||0.49 %|
|Solana||0.56 %||9.09 %||2.14 %|
|Dogecoin||0.77 %||5.71 %||0.31 %|
|Polkadot||1.95 %||7.89 %||8.05 %|
|Wrapped Bitcoin||0.72 %||2.88 %||1.03 %|
|Lido Staked Ether||0.98 %||5.16 %||7.33 %|
|Avalanche||0.09 %||16.31 %||9.36 %|
|TRON||0.67 %||1.15 %||3.18 %|
|Shiba Inu||1.05 %||6.82 %||4.10 %|
|Dai||0.23 %||0.23 %||0.55 %|
|Cronos||0.84 %||5.28 %||3.83 %|
|Litecoin||0.86 %||7.56 %||0.70 %|
|LEO Token||0.94 %||0.08 %||4.58 %|